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Apple-TSMC Sole-Source Embrace Holds Risk for iPhone Maker

Alan Patterson, EETimes
8/22/2018 00:01 AM EDT

TAIPEI — Apple is likely to keep TSMC as its sole supplier of application processors for at least two years as other foundries fail to meet expectations, according to industry analysts.

The world’s biggest electronics company and the world’s biggest foundry have their arms around each other, yet both may find the intimacy a bit uncomfortable. Apple will be risking the regular launch of new iPhones and iPads by counting on TSMC for production of follow-up processors to the A11 without a backup supplier. TSMC, on the other hand, will depend on Apple to fill up nearly 80 percent of its leading-edge 7nm capacity, entering production this year.

The love affair started in 2014, when Apple embraced TSMC to make all of the new iPhone and iPad chips. The Taiwan foundry responded with an investment of $9 billion, employing 6,000 people around the clock to bring up a new fab in the southern city of Tainan in a record 11 months with “flawless execution”, according to Apple Chief Operating Officer Jeff Williams, speaking at a TSMC event in October last year.

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Apple-TSMC Sole-Source Embrace Holds Risk for iPhone Maker


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