Tegra 2 is finally happening and this is quite good news for Nvidia. Motorola, LG, Toshiba and many others plan to ship phones and tablets based on the new chip shortly.

However, a few industry sources are telling us that Nvidia is experiencing yield issues with the 40nm based Tegra 2 chip. We don’t know what is causing it but it’s appears that the issue won’t hurt Tegra 2 schedules or make an impact on its success.

LG and Motorola didn’t complained so far about the shipments but we guess that yields are not where Nvidia wants them to be and that it is simply getting more faulty chips per wafer than expected. TSMC is the factory of choice and so far Nvidia's only fab, so the issue is between the two long standing partners.

We asked Nvidia to comment and we will get back to you if we get something better than the usual no comment.