Major Apple supplier TSMC, the world’s largest chipmaker and a major Apple and Nvidia supplier, forecast second-quarter sales may rise as much as 30% as it rides a wave of “insatiable” demand for semiconductors used in artificial intelligence (AI) applications.
“Almost all the AI innovators are working with TSMC to address the insatiable AI-related demand for energy efficient computing power,” CEO C.C. Wei said during the company’s first-quarter earnings call. “AI-related data centre demand is very, very strong,” he said, adding that the shift from traditional servers to AI servers is “favourable” to TSMC.
AI servers are expected to account for a low-teens percentage of its 2024 revenue, more than double from last year, with that figure rising to more than 20% of revenue by 2028, it said.
Demand for auto chips would fall this year, compared with a previous estimate of growth, it added.
Looking ahead, TSMC said it expects business in the second quarter to be supported by strong demand for its industry-leading 3 nanometre (nm) and 5nm technologies, although that strength would be partially offset by sluggish demand for smartphones.
For 2024, the company said it expects revenue to rise in the low- to mid-20% range in U.S. dollar terms.
“Looking at 2024, macro economy and geopolitical uncertainties persist, which could further affect consumer confidence and end-market demand,” TSMC said in a statement.
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MacDailyNews Take: Apple’s forthcoming M4 chips for Macs are widely expected to be built on TSMC’s 3-nanometer process.
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I had doubts of how significant the Apple portion of the gains TSMC was predicting to have and this article now shows that almost no portion is attributable to Apple unless they are building AI Servers and data centers using chips designed in-house.