Taiwanese media sources announced on June 24 that TSMC, a local foundry company, beat Samsung Electronics to supply Apple with mobile application processors (APs). An AP is a device compared to the brain of the iPhone, iPad, etc. Samsung has been the sole supplier when it comes to the A6 processor used in the iPhone5. The DigiTimes Daily Newspaper announced that TSMC and Apple signed a three-year supply contract with each other and the former manufactures the A8 processor from next month for the next-generation iPhone and iPad that are slated to hit the market in 2014. It is said that TSMC is going to boost the production volume from the first quarter of 2014 after putting the 20nm process into operation late this year. Still, the daily newspaper did not mention whether TSMC has become the sole AP supplier for Apple.
According to industry experts, the contract has to do with Apple’s strategy to reduce its dependence upon Samsung Electronics, its archrival in the global smart phone industry. TSMC is expected to start the production of the A9 and A9X processors from the third quarter of next year, too.
Assuming that TSMC wins 100% of the APs for the new products of Apple, the new profits are likely to reach approximately three trillion won. At present, Apple is using about 200 million units of APs a year for its iPhones and iPads. The DigiTimes added that TSMC did not set out its official position regarding the press reports.