Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it is to start high-volume production of its most advanced 20-nanometer (nm) chips next month, a move the chipmaker expects will give its revenue a double-digit boost next year.
The move would also make TSMC the world’s leading contract chipmaker supplying 20nm chips.
Analysts say that mass 20nm chip production could put TSMC in a position to dethrone Samsung Electronics Co as the supplier of Apple Inc’s next-generation A8 chip next year.
TSMC chairman Morris Chang (張忠謀) said in October that 20nm chips would start contributing to the firm's revenue in the second quarter of next year, following the launch of mass production in the first three months of next year.
“The 20nm system-on-a-chip is the most critical ramp-up TSMC has carried out in years. We will start high-volume production of this chip next month,” TSMC president and CEO Mark Liu (劉德音) said in a keynote speech at the company’s annual supply chain management forum in Hsinchu.
Liu said TSMC is on track to ship the chips to its clients on schedule. Thus far, the world’s top contract chipmaker has taped out 20 of the 20nm chips, Liu said in his first public speech after being promoted to co-CEO last month.
The company is expected to ship 165,000 20nm chips to Apple next year, accounting for 10 percent of its revenue that year, Daiwa Capital Markets analyst Eric Chen (陳慧明) said.
Credit Suisse analyst Randy Abrams forecast Apple orders to account for 6.5 percent of TSMC’s overall revenue next year, adding that Qualcomm Inc and MediaTek Inc (聯發科) are to become key clients for TSMC next year.
In the speech, Liu highlighted TSMC’s progress on the 16nm technology front, saying that the company recently initiated the production of 16nm chips and planned to begin mass production within a year.
TSMC is expected to make US$5.4 billion in revenue from advanced 28nm chips this year and the figure could further increase next year, Liu said.
The company, which commands more than 90 percent of the global 28nm chip market, said earlier this year that 28nm chips would be the biggest contributor to revenue this year, since production capacity and revenue are set to triple on an annual basis.
Last quarter, 28nm chips made up 32 percent of TSMC’s revenue of NT$162.58 billion (US$5.48 billion).
As a result, Liu said TSMC’s revenue would show a 17 to 18 percent annual growth this year and grow by double-digit percentage points next year, supported by continuing demand for mobile applications.
That figure would beat the 9 percent annual growth forecast for the contract chipmaking industry, as well as the semiconductor industry’s 5 percent growth.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to