A transistor includes a first layer over a substrate. The transistor also includes a second layer over the first layer. The transistor further includes a carrier channel layer at an interface of the first layer and the second layer. The transistor additionally includes a gate structure, a drain, and a source over the second layer. The transistor also includes a passivation material in the second layer between an edge of the gate structure and an edge of the drain in a top-side view. The carrier channel layer has a smaller surface area than the first layer between the edge of the gate structure and the edge of the drain in the top-side view.