Apple will be TSMC’s top 5 nm chip ordering partner this year, accounting for 53% of production with the A14 processor on the iPhone 12 series, the A15 Bionic on the iPhone 12s (iPhone 13) and the M1 chip for the Mac.
The Taiwan Semiconductor Manufacturing Company (TSMC) is the world’s largest semiconductor processing workshop. Many tech giants including Apple, MediaTek, Huawei and Qualcomm do not own the factories or vehicles needed to make chips. Therefore, companies like TSMC or Samsung will take on the role of outsourcing processor chips to these manufacturers.
Last year, Qualcomm’s flagship Snapdragon 865 chip was produced by TSMC on a 7nm process. The successor Snapdragon 888 is manufactured by Samsung Foundry, Samsung’s semiconductor outsourcing unit, using a 5 nm process. Behind TSMC, Samsung Foundry is the world’s second largest contract processing workshop.
On February 5, Counterpoint Research released a number of predictions for the semiconductor industry for 2021. The revenue of chipset companies will increase 23% in 2020, reaching $ 82 billion. Counterpoint expects sales of the semiconductor industry to reach 92 billion USD, up 12% compared to 2020. In which, TSMC (Taiwan) revenue will increase from 13-16% in 2021, in line with the the overall growth rate of the whole industry. Other names like Samsung, Qualcomm or NVIDIA are expected to have growth of about 20%.
Driving growth this year is attributed to the profits from wafers, circular silicon wafers containing a large number of semiconductor sensors, when their prices rose by around 10%.
TSMC and Samsung Foundry are both suppliers of chips produced on 5 nm and 7 nm processes. Based on transistor density (number of transistors per square millimeter), the lower the manufacturing process, the higher the chip performance and less energy consumption. This year, the first 5nm chip on the mobile market is Apple’s A14 Bionic.
Predict TSMC’s 5 nm chip market share that partners will hold
Counterpoint Research predicts Apple will be TSMC’s top 5-nm chip ordering partner this year, accounting for 53% of production with the A14 processor on the iPhone 12 series, the A15 Bionic on the iPhone 12s (or iPhone 13) and the M1 chip for Mac. 5nm chips will account for 5% of the 12-inch wafers produced this year, up from less than 1% in 2020.
As predicted, 24% of TSMC’s 5nm chip batches will be owned by Qualcomm as Apple plans to use Qualcomm’s 5G Snapdragon X60 5nm modem on the iPhone 13. Both TSMC and Samsung are forecast to have 90% of chip orders. 5nm in 2021 with total revenue of up to 10 billion USD.
Unlike the 5-nm chipset, the 7-nanometer chip is more widely used, with 35 percent of the output being made for smartphones. According to Counterpoint’s prediction, 7nm chips will account for 11% of the 12-inch wafers produced this year.
Predict TSMC’s 7 nm chip market share that partners will hold
Both TSMC and Samsung make a variety of 7nm chips, including those made with the EUV. EUV is an ultraviolet printed circuit board technology, using UV rays to etch semiconductor parts onto the wafer to simplify the work needed for engineers. From there, foundries can easily transition from the 5 nm process down to 3 nm and go into mass production next year.
This year, TSMC’s top 7-nm chip customer will be AMD with 27% of production. Next is NVIDIA with 21%, MediaTek with 10% and Intel with 7%. In particular, Apple will place 6% of TSMC’s 7nm chip shipments to equip on older iPhone models. On the other hand, the Taiwan semiconductor company will need the help of Intel as a contract outsourcing company to meet the large volume of orders for manufacturers.
The analyst firm emphasizes that chip inventories will be significantly higher, now up to 79 days compared to 70 days since 2016. Pandemic, global trade wars and a number of other issues have taken time. inventory increases. As a result, the chip industry will adapt to higher levels of inventory throughout the year. According to Counterpoint, revenue in the industry will reach $ 100 billion in the 2022-2023 period.
Ngoc Diep according to PhoneArena