Taiwan's TSMC begins mass production of 3nm chips

TAINAN, Taiwan - Taiwanese tech giant TSMC said Thursday it had started mass production of its 3-nanometre chips, among the most advanced to come to market.

The Taiwan Semiconductor Manufacturing Company operates the world's largest silicon wafer factories and produces high-performance chips used in everything from smartphones and cars to missiles. It is also Apple's primary chip supplier.

Its 3nm-process chips are expected to have more processing power while using less power, boosting battery performance.

"Our 3nm technology will be used massively in future state-of-the-art technological products, including supercomputers, cloud servers, high speed internet and many many mobile devices," chairman Mark Liu said at a ceremony announcing mass production at a plant in the southwestern city of Tainan.

He added that the company plans to build even smaller 2nm plants in the Taiwanese cities of Hsinchu and Taichung.

TSMC's South Korean rival Samsung began mass production of its 3nm chips in June.

Taiwan plays an outsized role in the global chip industry.

TSMC alone accounts for nearly 50 percent of the world's production of chips below 10nm.

The concentration of such a crucial industry in one place has begun to cause geopolitical jitters, especially as China increasingly threatens Taiwan, a self-ruled democracy that the Chinese Communist Party claims and has vowed to one day seize.

The global chip shortage during the coronavirus pandemic deepened those concerns.

TSMC has been lobbied by western powers to build more foundries overseas which it has agreed to do.

The company is constructing a huge $40 billion plant in Arizona which will eventually produce its own 4nm and 3nm chips, part of US efforts to ensure a stable supply of semiconductors on its soil.

President Joe Biden attended a ceremony earlier this month to announce a mammoth expansion of the Arizona plant, which is one of the largest foreign investments in the United States. 

TSMC has also agreed to build foundries in Japan and is exploring Germany as a possible location.

At the same time, Taiwan's tech companies and its government are keen to ensure the majority of state of the art production remains at home, in part because the industry affords the island some protection.

Any invasion or blockade of Taiwan by China would have catastrophic consequences for the global economy because so many crucial semiconductors are made there -- a buffer that analysts call Taiwan's "Silicon Shield".

President Tsai Ing-wen has played down concerns that Taiwan risks losing that shield -- and jobs -- by building foundries overseas and instead has portrayed the investments as a sign of the island's technological prowess.

"TSMC founder Morris Chang has repeatedly said Taiwan remains the best place for TSMC to invest in as Taiwan has a comprehensive ecosystem and a superior workforce," Tsai said earlier this week.

"He meant that we do not have to worry about Taiwan’s chip industry."

Agence France-Presse

Fewer orders at Apple suppliers could signal first iPhone sales decline

TAIPEI - Some of Apple Inc.'s main Asian suppliers expect revenues and orders to drop this quarter, indicating iPhone sales are almost certain to post their first annual decline since the flagship product was launched almost a decade ago.

The forecasts of lackluster sales by companies including Taiwan Semiconductor Manufacturing Co (TSMC), the world's biggest contract chipmaker, and smartphone camera lens producer Largan Precision Co Ltd add to concerns about Apple's outlook amid slowing global demand for smartphones.

Industry executives say the latest iPhone did not have enough new features from the previous model to tempt users, raising fears that Apple's innovative streak - and the profits it has generated - may be running its course.

Apple, which reports December-quarter results on Tuesday, declined to comment on its sales outlook.

"Visibility is only a month at a time and demand is quite weak," Largan Precision Chief Executive Adam Lin told an earnings briefing, referring to his company's overall business.

Other suppliers said Apple now only gave them orders one month in advance, instead of the usual three months.

"We have to be very flexible in terms of capacity," said an executive at one of those firms, declining to identify their company or be named due to a confidentiality agreement that prevents Apple suppliers from discussing its order book.

Apple has previously said that individual data from its supply chain was not an accurate reflection of its outlook.

But TSMC, which makes some of the chips that go into iPhones, forecast this month that first-quarter revenues would likely fall by up to 11 percent year-on-year, adding that demand for high-end smartphones would also be weak.

An 11 percent quarterly decline would be the steepest revenue drop for TSMC in almost 7 years, Thomson Reuters data shows.

Earlier this month, people familiar with the matter told Reuters that Taiwan-based Foxconn, which assembles most iPhones, had taken a rare decision to cut working hours over a major holiday during which workers usually rack up overtime.

Foxconn, the trade name for Hon Hai Precision Industry Co Ltd, saw its December revenues slump by a fifth and 2015 sales miss expectations.

A more detailed picture about Apple's outlook could emerge next week if key suppliers including LG Display Co Ltd, SK Hynix Inc and Samsung Electronics Co provide first-quarter forecasts when they report December-quarter earnings.

First-quarter revenues at both LG Display and Hynix are expected to fall around 10 percent, according to Thomson Reuters I/B/E/S data.

Analysts say iPhone sales could pick up during the second half of the year, when the company usually launches new products, but with competitors such as Samsung Electronics and Huawei Technologies Co Ltd sharpening their edge, some suppliers are not so sure.

"The pace of innovation has slowed. Apple is going toward the same direction as other brand names," said another Taiwanese Apple supplier.

source: www.abs-cbnnews.com