TSMC has never been so dominant as Apple orders boost profit

“Taiwan Semiconductor Manufacturing Co. is on a roll,” Kyoungwha Kim and Yu-Huay Sun report for Bloomberg. “The world’s largest contract chipmaker has surged 32 percent in 2016, climbing to its highest level versus MSCI Inc.’s global gauge of technology stocks on record. The $156 billion company now accounts for 16 percent of Taiwan’s entire equity market value, the biggest proportion according to data stretching back 13 years, and none of the 33 analysts who cover it recommend selling the shares.”

“While the company has benefited from a broader rally in technology companies this year that’s seen rivals including Intel Corp. reach multi-year highs, TSMC is luring investors with record profit as demand for Apple Inc.’s new iPhones fuels orders for its processor chips,” Kim and Sun report. “‘Samsung’s issues and the perceived benefit for Apple is surely creating some optimism,’ said Sandy Mehta, chief executive officer of Value Investment. ‘TSMC is the best in class. Valuations are not very high for TSMC, and rising estimates have led to investor optimism. The shares could still have upside.'”

“TSMC has been able to count on demand for Apple’s new iPhone 7 models to fuel sales of the A10 processor it makes, helping it weather a slowdown in the global smartphone market as it invests in more advanced production technology,” Kim and Sun report. “The company will ‘soon’ start mass production of chips using 10-nanometer processors, said Elizabeth Sun, a spokeswoman at TSMC.”

Read more in the full article here.

MacDailyNews Take: Suck it, Samsung!

Analysts see strong iPhone 7 sales as A-seies chip fab TSMC sets new profit and sales records – October 13, 2016
Apple’s iPhone 7 poised to set new sales records. How could the media have been so wrong? – September 19, 2016
The ‘iPhone 7 will be disappointing’ meme continues – September 6, 2016
Apple’s ‘boring’ iPhone 7 series set to surprise and delight – July 8, 2016
Why a ‘boring’ iPhone 7 will do just fine – June 22, 2016
Are leaks suggesting iPhone 7 will be ‘boring’ Apple’s attempts at misdirection? – June 17, 2016
Why Apple’s iPhone 7 doesn’t have to be a ‘disappointment’ – May 3, 2016


  1. In the days when Samsung decided to become an untrustworthy partner for Apple, there was no other company that could have been awarded the contract to make the chips that Samsung made for Apple.

    Apple decided to invest a hell of a lot of money building up TSMC and they have now become not merely a rival to Samsung, but are leading them in many areas.

    It’s bad enough that Samsung have thrown away huge orders from Apple that would otherwise have been theirs by default, but now they are having to watch what was once an insignificant upstart turn into the world’s largest chip manufacturing company.

  2. It’s strange how Apple can boost the fortunes of other companies but can’t do anything to boost its own share price. If TSMC is leading in building the A10 Fusion chip then why is everyone saying how far behind the iPhone is compared to other smartphones? I’d think Apple’s iPhone would have a fairly large advantages in power and efficiency. So little of what I read makes much sense to me. There were a number of articles boasting about how the Huawei Mate 9 smartphone was the most powerful smartphone on the planet or something to that effect. The media has been pushing that statement constantly. No comments have been made by Apple to dispute that fact.

    1. Apple almost never comments on competitors products, so that is not a surprise. Apple is even slow to refute or respond to FUD regarding its own products.

      You have been on this forum for quite a while. You know by now that logic has very little to do with media coverage of Apple or the price of AAPL.

  3. @alanaudio

    You need to get your facts right, please.

    Taiwan’s TSMC is the world’s first dedicated semiconductor foundry since 1987 and is already the world’s largest and most advance foundry for decades. Apple may have invested money in TSMC and given it business but it did not go from “insignificant upstart” to “world’s largest chip manufacturing company” because of Apple’s investment.

    Samsung foundry only started in 2005, and according to many in the industry, it has stolen many trade secrets and techniques/technologies in this field from TSMC through business espionage activities and incited defections.

    If anything, working with TSMC means that Apple has (finally) gained a powerful partner from a trusted country, and distant itself from a thief.

    From Wikipedia:
    Founded in Taiwan in 1987, TSMC was the world’s first dedicated semiconductor foundry and has long been the leading company.

    1. When Apple’s problems with Samsung came to light, most industry observers felt that TSMC was not a viable alternative to Samsung as a supplier for Apple’s chips.

      It was only after Apple’s support over a number of years that TSMC ended up in a position to reliably supply chips to Apple’s standards and in the immense quantities required.

      I’m very encouraged by Apple’s partnership with TSMC and hope that it sends a powerful message to other partners. Work harmoniously with Apple and reap the rewards. On the other hand, if you abuse your relationship with Apple in the way that Samsung did, then you will reap what you sow.

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