Yield is the percentage of chips that are functional. Roughly, you can think of it as the probability of a chip having 0 defects. The bigger the chip, or the higher the defect density, the lower this probability becomes. Chip designers will also include mitigation techniques (e.g. redundancy) to allow chips to work even with some defects.
Does this mean that errors happen on a later stage of production? How do we get from defects/cm to yield?
Yield is the percentage of chips that are functional. Roughly, you can think of it as the probability of a chip having 0 defects. The bigger the chip, or the higher the defect density, the lower this probability becomes. Chip designers will also include mitigation techniques (e.g. redundancy) to allow chips to work even with some defects.