As reported, TSMC is still having yield issues with its 40-nm process, according to analysts. TSMC's 40-nm yield problems surfaced earlier this year, but the company claimed it largely resolved the problem.

AMD, Nvidia and others are impacted. In response to the reports, TSMC officials said: ''The 40-nm yield didn't drop as reported. As a matter of fact, yield on the 40-nm process remained flat. TSMC is confident that the 40-nm yield will improve at the beginning of next year.''

On Monday, TSMC reached an out-of-court settlement with China's Semiconductor Manufacturing International Corp. (SMIC).

Under the terms of the settlement, SMIC (Shanghai) will pay TSMC (Hsinchu) $200 million plus an undisclosed amount of SMIC stock and warrants, according to Jeffrey Chanin, a partner at the law firm Keker & Van Nest LLP, which represents TSMC. The court will maintain jurisdiction to enforce the verdict, Chanin said. All other terms of the settlement are confidential, he said.