South Korea’s Samsung Electronics Co is expected to win the majority of orders for the processors powering Apple Inc’s iPhones this year, underlining an Apple strategy to diversify foundry suppliers, a foreign brokerage said.
In a research note on Thursday last week, a major US-based brokerage said that Apple had previously partnered with one foundry for each generation of processors, such as Samsung for the 32-nanometer and 28-nanometer processes and with Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) for the 20-nanometer process.
With broader offerings in the pipeline, such as a larger iPad and a low-end iPhone, it seems clear that Apple plans to have a much more diverse semiconductor portfolio, the brokerage said.
“Our view is, going forward with so many more products, it becomes easier for Apple to use multiple foundries, and to split manufacturing by products,” said the US brokerage, whose name cannot be reported under new rules set by Taiwan’s Financial Supervisory Commission because it is offering specific forecasts.
Given Samsung’s bullish outlook on its 14-nanometer process and TSMC’s guidance that its 16-nanometer process is expected to make only a single-digit contribution to its revenue by the end of this year, Samsung is expected to get the orders for new iPhone chips this year, the brokerage said.
However, it expected that TSMC will continue making the A8 chips used in the iPhone 6 and 6 Plus models in the first half of this year, adding that TSMC could also make the 20-nanometer chip for a low-end iPhone and a 16-nanometer chip for a high-end iPad in the second half.
The brokerage estimated that TSMC’s revenue from Apple would grow from 6.5 percent of total sales last year to 9.6 percent in this year.
However, in the second half of this year TSMC’s revenue from Apple is expected to drop by about 40 percent from the same period a year earlier, assuming that Apple switches to Samsung for the new iPhone chips, the US brokerage said.
TSMC shares yesterday rose 1.06 percent to NT$142.50 in Taipei trading, outpacing a 0.27 percent gain in the broader market.
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