Reports that Apple plans to outsource some of its custom-designed chips to Intel have raised concerns about a potential shift in TSMC's exclusive partnership with Apple. However, experts believe TSMC will likely maintain its status as Apple's key partner for the foreseeable future, given its advantages in yield, power efficiency, and advanced packaging technology.
On May 11, Taiwanese media outlets, including Focus Taiwan, reported mixed assessments within the industry regarding the potential collaboration between Apple and Intel. The Wall Street Journal had previously reported on May 8, citing multiple sources, that Apple reached a preliminary agreement to have Intel produce some of its custom-designed chips. Apple and Intel have reportedly been negotiating this partnership for over a year.
In this context, Liu Peijian, a researcher at the Taiwan Institute of Economic Research, assessed that TSMC is likely to remain Apple's primary chip manufacturing partner. He noted that TSMC's advanced packaging technologies, including InFO (Integrated Fan-Out) and CoWoS (Chip on Wafer on Substrate), are still critical for the performance of Apple's A-series and M-series chips.
Liu pointed out that both Intel and Samsung are currently behind TSMC in terms of yield and power efficiency, making it difficult for Apple to shift its flagship chip orders away from the Taiwanese foundry in the near term. He analyzed that the deep technological collaboration between Apple and TSMC over the years has created a high barrier to entry for competitors. Unless rivals achieve significant breakthroughs in 2-nanometer or Gate-All-Around (GAA) technology, TSMC is expected to remain Apple's preferred manufacturing partner.
Intel is advancing its 18A process, while Samsung is exploring opportunities with its 2-nanometer GAA technology. However, Liu noted that both companies have faced issues with unstable yields and excessive power consumption in past large-scale production processes.
Considering TSMC's stable delivery performance and extensive research and development capabilities, Liu assessed that the company's leading position remains difficult to challenge. He added that for Apple, moving core chip orders too soon could pose significant supply chain risks.
Li Fangguo, chairman of President Capital Management, also told CNA that Apple's push for collaboration with Intel is not due to any technical issues with TSMC. Instead, he suggested that the growing demand for advanced processes from AI chip customers like NVIDIA has strained TSMC's production capacity.
Li stated that this situation highlights TSMC's dominant position in the advanced chip manufacturing sector, noting that demand across the industry currently exceeds supply.
Concerns About TSMC's Position
Conversely, some experts believe that a partnership between Apple and Intel could pose challenges for TSMC. According to the China Times, financial and economic expert Luan Muhua recently expressed on social media that if the collaboration between Apple and Intel is formalized, it could heighten TSMC's sense of crisis.
Luan assessed that if the partnership materializes, Apple would gain additional key options related to its supply chain, while Intel would secure a heavyweight customer in its foundry business revival. However, he pointed out that this could signify the practical end of TSMC's exclusive production era for Apple chips.
Luan explained that it is currently unclear which Apple products Intel would produce chips for. However, he noted that even a slight adjustment in Apple's supply chain, given its massive annual shipments of iPhones, iPads, and Mac computers, could impact chip production facility allocations and market forecasts.
He raised questions about whether Intel has the capacity to share production of Apple orders with TSMC. However, he acknowledged that the backing of the White House could change the dynamics, suggesting that this shift is reflected in the recent stock trends of Intel, Apple, and TSMC.
* This article has been translated by AI.
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