Apple chip supplier is busy producing cutting-edge chips

Apple chip supplier is busy producing cutting-edge chips
In what might be a positive sign for a turnaround in smartphone demand, DigiTimes reports that Taiwan Semiconductor Manufacturing Company (TSMC) has tripled the lead time it needs to churn out chips using its 7nm process. The company is the largest foundry in the world and manufacturers chips designed by companies without the facilities required to produce these chips themselves. That would include firms like Apple, Huawei, and Qualcomm. TSMC said that last year it was "manufacturing 10,436 different products using 261 distinct technologies for 481 different customers," but Apple is responsible for the largest percentage of its annual revenue.

The 7nm process refers to the number of transistors that fit inside an integrated circuit; the smaller the number, the more transistors inside. And the more transistors inside a chip, the more powerful and energy-efficient it is. Consider that the 5G version of Huawei's Kirin 990 SoC contains 10.3 billion transistors. Next year, TSMC should start rolling 5nm chips off of its assembly line and these components will include 171.3 million transistors per square millimeter. And 3nm chips could be a reality by 2022.

Lead time for 7nm production has tripled from two months to six months

The lead time is now six months, up from two months, which means that TSMC's customers will have to get their orders in earlier if they want to maintain a steady supply of chips. The foundry says that the longer lead time is only required for customers shifting to 7nm from a larger process node, or for those who are expanding capacity. TSMC is believed to have given Apple priority for its 7nm needs which is one of the reasons why such lead times have tripled. It would appear that other companies have had to rush to place their orders before Apple took over the 7nm node.

Back in 2015, both TSMC and Samsung manufactured the A9 chip that powered the Apple iPhone 6s and iPhone 6s Plus. Since then, only TSMC has been given the assignment of churning out the chipsets used on the iPhone. Apple obviously needs a foundry that can deliver chips in the quantity and quality it needs for its smartphones. Since Apple started relying solely on TSMC for 2016's iPhone 7 and iPhone 7 Plus, the tech giant seems totally content with the company.

While business has been booming at TSMC, smartphone sales this year are expected to drop by 3.8%. But it seems that the longer lead time at TSMC is foreshadowing a turnaround in 2020. Gartner forecasts a 1.5% increase in smartphone sales next year. The increasing demand for 5G handsets that many expect to start in 2020 could be one of the reasons for TSMC's full dance card; some of the 7nm production includes 5G modem chips.

TSMC is losing a major customer in 2020, but just for one year. Samsung, which has its own semiconductor fabrication facilities, is expected to produce the Snapdragon 865 Mobile Platform. But the following year, it will be back to TSMC for the 5nm Snapdragon 875 Mobile Platform.

TSMC is in the middle of a legal battle with GlobalFoundries. The latter claims that TSMC infringed on 16 of its patents and filed suit against the foundry in the U.S. in Germany. In its filing submitted with the International Trade Commission (ITC), GlobalFoundries asked for an injunction against the importation into the U.S. of devices that might have been produced illegally using its IP. That would ban several iOS and Android devices from being shipped into the U.S. TSMC has denied the claim and said that it "will fight vigorously, using any and all options, to protect our proprietary technologies."



1. Vancetastic

Posts: 1508; Member since: May 17, 2017

The title implies that they only supply Apple with chips. Oh well, those other companies aren't really important.

2. OneLove123

Posts: 1161; Member since: Aug 28, 2018

Yep, qualcomm and huawei are such small potatoes that tsmc don't even need them.

5. Vancetastic

Posts: 1508; Member since: May 17, 2017


4. gadgetpower

Posts: 265; Member since: Aug 23, 2019

It only shows the impact of apple in technology.

6. Vancetastic

Posts: 1508; Member since: May 17, 2017

You don't really "get" stuff, do you?

9. lyndon420

Posts: 6815; Member since: Jul 11, 2012

TSMC isn't important enough to be featured in their own articles title lol.

10. oldskool50 unregistered

Whaaaaaaa? What impact? Be specific. Because the article is just saying Apple is sticking with their same chip fabricator. The only impact is, if Apple is YOUR biggest customer, as Apple loses sales, that means your profits fall with them or you could go out of business like some companies have. Because they were dumb enough to put all their eggs in one basket.

3. Dr.Phil

Posts: 2427; Member since: Feb 14, 2011

It’ll be interesting to see how the 7nm Snapdragon 865 goes up against a potential 5nm Kirin and A14.

8. foreverNOOB

Posts: 165; Member since: Jul 07, 2017

These manufacturers are announced their flagship SoC with neck-to-neck timeframe. Apple usually introduce A series SoC and new Iphone in September and start selling them between September this year to August next year and Kirin between this October to next September, Snapdragon devices usually got announced just 2-3 months after Apple and Kirin and devices utilizing the SoC will appears between December to next November. So, technically the Snapdragon 865 is belong to the same generation of SoC as the A13 and Kirin 990. Now, both A13 and Kirin990 already announced, Snapdragon 865 will come to life around November. And then, this process will repeating agian and again. That means you have to compare Snapdragon 875 with A14 and Kirin 1000(or what ever Huawei choose to call it) because the real competitors for 865 are A13 and Kirin990, and it will better represent the same generation of SoC, too. Ps: First Snapdragon 855 device got announced in December 2018, the Lenovo Z5 pro gt, which also means that Snapdragon 855 aims at A12 and Kirin 980.

7. dumpster666

Posts: 90; Member since: Mar 07, 2019

lt me guess... alan?

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