So… Remember I mentioned trends in the semiconductor industry were good hints and indicator to the health of the tech industry. And remember I mentioned Taiwan Semiconductor was a good indicator of the health of semiconductor industry, because TSMC is responsible for more than 1/2 of the world’s semiconductor fab, and if TSMC’s 7nm production is at fully capacity, it suggests there’s no slowdown in tech, considering TSMC’s major customers are Apple, Qualcomm, AMD, MediaTek , Huawei, and others and if there was a slowdown in the demand for consumer electronics, TSMC would be the first to feel with less demand for its capacity?
Let’s play connect the dots…
(Bloomberg) — Taiwan Semiconductor Manufacturing Co. projected quarterly revenue well above analysts’ estimates, underscoring hopes that the rollout of fifth-generation enabled smartphones in 2020 will galvanize growth for Apple Inc.’s main chipmaker.
TSMC forecast revenue of $10.2 billion to $10.3 billion in the March quarter, surpassing estimates for $9.6 billion. Taiwan’s largest company also posted a fourth-quarter profit that beat the highest analyst’s estimate after customers from Apple to Huawei Technologies Co. adopted more advanced semiconductors in smartphones.
The robust results demonstrate how the world’s largest contract chipmaker is investing in technology to safeguard its market lead over Samsung Electronics Co. and Intel Corp. TSMC spent almost $15 billion on technology and capacity in 2019 and is prepared to shell out as much as $16 billion this year, anticipating the advent of fifth-generation smartphones. The company, a barometer for the tech industry thanks to its heft and place in the supply chain, has said the advent of 5G will result in more chips in devices than before.
Strong sales may extend to 1H off-peak periods, as many of TSMC’s customers such as Huawei, Qualcomm and Mediatek are quickening their pace of adopting cutting-edge processes to prepare for the launch of 5G mobile devices.
There doesn’t appear to be a slowdown in semi-land at all. And as others were already writing about , TSMC is running full capacity, and there hasn’t been a reduction in demand from
a consumer electronics perspective.
Told ya!
Oh and since Apple will be moving from 7nm to TSM’s 5nm node and Huawei might reduce their capacity due to the state Huawei is in, some might think TSM will have a lot excess and unused capacity in 7nm ….Don’t worry… Much of the extra 7nm capacity that would be then available is already reserved by AMD….
AMD will become TSMC’s largest 7nm customer in the second half of 2020, according to Apple Daily’s supply chain sources. The change of order comes as a result of higher orders from AMD and Apple moving to 5nm for its A14.
Apple Daily reports that TSMC’s 7nm wafer capacity will be 110,000 wafer starts per month (WPM) in the first half of 2020. TSMC’s Top 5 would consist of Apple, HiSilicon (who is starting to ship to external customers), Qualcomm, AMD and MediaTek.
In the second half of the year, TSMC’s capacity would increase to 140,000 WPM and AMD’s orders would double (although it was not specified compared to which period). With that, AMD would become TSMC’s largest 7nm customer as Apple moves to 5nm. This also implies that AMD would jump over HiSilicon and Qualcomm.
