Taiwanese Apple Suppliers Face Falling Stock Prices Amid Ongoing Concern Over Weakened iPhone X Demand

Three major Apple suppliers faced falling stock prices on the Nikkei Asia300 Index today, believed to be directly related to "concerns over demand for iPhone X." The three Taiwanese suppliers were Largan Precision, Hon Hai Precision Industry (Foxconn), and Taiwan Semiconductor Manufacturing Company, dropping 4.4 percent, 1 percent, and 3 percent on the index, respectively.

iPhone X demand concerns and decline in supplier stock prices came after the latest analyst report by JP Morgan yesterday, predicting "slashed" iPhone X orders in the first part of 2018. In a research note reported by CNBC, analyst Narci Chang said "high-end smartphones are clearly hitting a plateau this year," singling out Apple by forecasting that iPhone X manufacturing "might be down 50 percent quarter-over-quarter."


Reports of "weakened" iPhone X demand heading into 2018 began emerging late last year, mainly stemming from analyst belief that the high price of the device would eventually lead to reduced sales after early adopters got their iPhone X. These reports have caused several Apple suppliers to be anxious over low order visibility for the full range of iPhone 8, iPhone 8 Plus, and iPhone X models in Q1 2018. CLSA analyst Nicolas Baratte argued that the reported reduction of the iPhone X's Q1 2018 shipment forecast from 50 million units down to 30 million units "remains inflated."

Despite multiple stories about the iPhone X's plateaued demand in early 2018, the smartphone is believed to have sold well following its fall launch in 2017 and throughout the holiday season. Research data shared just yesterday by Canalys reported that Apple shipped 29 million iPhone X units in Q4 2017, making the device the "world's best-shipping smartphone model over the holidays."

Earlier in January, Kantar Worldpanel said that the iPhone X saw "stellar" performance in several countries during November of last year, though it was outsold by the iPhone 8 and the iPhone 8 Plus in the United States. Combined, Apple's three new iPhones captured the top spots for best-selling smartphone models during the month. Kantar's global OS data pointed towards "staggering" demand for the iPhone X in China from users said to be switching sides from rival smartphone makers.

We should get a better view of how the iPhone X sold soon, when Apple reveals its earnings results for the first fiscal quarter of 2018 on Thursday, February 1.

Related Roundup: iPhone X
Buyer's Guide: iPhone X (Buy Now)

Discuss this article in our forums

TSMC is Reportedly Exclusive Supplier of A12 Processors in 2018 iPhones

Apple has reportedly selected Taiwanese manufacturing company TSMC to remain its exclusive supplier of so-called "A12" processors for a trio of new iPhone models expected to launch in the second half of 2018, according to DigiTimes.


The report, citing unnamed sources within Apple's supply chain, claims the A12 chip will be manufactured based on a 7nm process and incorporate extreme ultraviolet technology, allowing for more transistors to be packed into a smaller wafer, and paving the way for continued performance improvements in the next iPhones.

TSMC is already the exclusive supplier of A11 Bionic chips for the iPhone 8, iPhone 8 Plus, and iPhone X, and it was also said to be the sole manufacturer of A10 Fusion chips for the iPhone 7 and iPhone 7 Plus.

If the report is accurate, it would be a loss for Samsung, which has been attempting to win back orders from Apple for around two years. Both Samsung and TSMC supplied Apple with A9 chips for the iPhone 6s, iPhone 6s Plus, and iPhone SE, but Apple has relied upon TSMC as its sole supplier for newer devices.

The Korea Herald last July reported that Samsung had secured a deal to supply some of the A12 chips for new iPhones in 2018, but two days later, DigiTimes reported that TSMC was still likely to obtain all of the next-generation A-series chip orders for Apple's upcoming 2018 series of iPhones.

TSMC's in-house InFO wafer-level packaging is said to make its 7nm FinFET technology more competitive than Samsung's. Our own Chris Jenkins provided an in-depth technical look at this package process last September.

Related Roundup: iPhone X
Buyer's Guide: iPhone X (Buy Now)

Discuss this article in our forums

2018 iPad Pro Models Could Have Very Fast Octa-Core A11X Bionic Chip

Apple's next-generation iPad Pro models released in 2018 will feature octa-core processors, based on Taiwanese supplier TSMC's improved 7nm manufacturing process, according to Chinese website MyDrivers.

iPad Pro with slim bezels and no Home button rendered by Benjamin Geskin

The report, citing sources within Apple's supply chain, claims the eight cores in the tentatively named A11X Bionic chip will include three high-performance "Monsoon" cores and five energy-efficient "Mistral" cores.

Like the A11 Bionic chip in the latest iPhone models, which is built on a 10-nanometer process, the A11X chip will reportedly feature TSMC's integrated fan-out wafer level packaging, or InFO WLP for short.

The chip will also presumably include a next-generation M11 coprocessor and neural engine for artificial intelligence tasks, such as processing facial recognition given rumors about Face ID on 2018 iPad Pro models.

The eight-core processor should unsurprisingly result in CPU performance improvements on next-generation iPad Pro models.

Our own Chris Jenkins provided an in-depth look at the architecture of Apple's A11 Bionic chip. He also highlighted details about TSMC's improved 7nm process and advanced InFO packaging process for 2018.

Apple's current 10.5-inch and 12.9-inch iPad Pro models have an A10X Fusion chip based on TSCM's 10nm fabrication process.

In addition to gaining Face ID, next-generation iPad Pro models are expected to have an iPhone X form factor with slimmer bezels and no Home button. However, the tablets will reportedly continue to have LCD displays due to yield rates.

Related Roundup: iPad Pro

Discuss this article in our forums

Apple’s Jeff Williams Speaks About Artificial Intelligence and More at TSMC’s 30th Anniversary Ceremony

Apple's operating chief Jeff Williams was in Taiwan today to attend the 30th anniversary ceremony of Taiwanese Semiconductor Manufacturing Corporation, more commonly abbreviated as TSMC. There, he spoke about artificial intelligence, the future of the semiconductor industry, and more.


Williams first reflected on how Apple and TSMC began working together seven years ago. Today, TSMC is the exclusive supplier of the A10X Fusion and A11 Bionic processors in the latest iPhones and iPads.
First off, thank you. It's a real honor to be here with this distinguished group, and we're here of course to celebrate TSMC's 30 years. And it's amazing as you've seen in the slides, how far technology has been driven over that time. TSMC got its start shortly after the introduction of the legendary Cray II supercomputer, and 25 years later we put this same processing power in people's pockets with an iPhone 4 in 2010. It really is remarkable, and it was actually 2010 that the first seeds of our partnership between Apple and TSMC were planted.

I had flown to Taiwan and had dinner with Dr. Chang and Sophie at their house. It was a wonderful dinner. We were not doing business with TSMC at the time, but we had a great conversation. We talked about the possibilities of doing stuff together, and we knew the possibilities would be great if we could take leading edge technology and marry it with our ambitions. And what seems obvious now, wasn't then, because the risk was very substantial.

The nature of the way Apple does business is we put all of our energy into our new products, and we launch them, and if we were to bet heavily on TSMC, there would be no backup plan. You can not double plan the kind volumes that we do. We want leading edge technology, but we want it at established technology kind of volumes, and so that may be want Dr. Chang is referring to when he says "intense."
Williams said Apple and TSMC have gone on to ship over half a billion chips as part of a "wonderful partnership" between the two companies, in which billions of dollars has been invested to fulfill Apple's significant production demands.
…Together we decided to take the bet, take the leap, and Apple decided to have 100 percent of our new iPhone and new iPad chips, application processors, sourced at TSMC. And TSMC invested $9 billion and had 6,000 people working 'round the clock to bring up a Tainan fab in a record 11 months. And, in the end, the execution was flawless. And we've gone on together to ship over half a billion chips together in that short window. And I think TSMC has invested $25 billion. $9 billion on that first venture — there are very few companies in the world that $9 billion in capital across everything, not a single bet. So for that, we thank you, Dr. Chang, and everybody at TSMC. It's been a wonderful partnership.
Williams was asked to describe his vision of the next ten years in silicon, but he chose to reframe the question as "do we have enough processing power in our silicon to match our ambitions?" and answered accordingly.
It's interesting, when we look back a decade ago, the question we had was "do we have enough processing power in our silicon to match our ambitions?" The big challenge we had as we moved into the mobile revolution was this tradeoff between performance and power, and the view at the time is you had to choose — you've got one or the other.

Largely as a result of what the fabless model has done, what TSMC has done, what many people in this room have done, Simon and his organization from ARM — we have reached a point where those tradeoffs are not necessary. We have performance in thermally constrained environments. And so this opens up for the next decade a whole new world. So for the next decade, the question is not so much "Do we have enough processing power to meet our ambitions?" Though we need to keep working, of course we need to drive better lithography — don't slow down! — but I think the question for us is "Do we have the right ambitions to go utilize this technology in front of us?"
Williams went on to say that Apple thinks artificial intelligence and on-device processing will be key to the future of the semiconductor industry. He believes these advances will help to "revolutionize healthcare" for one example.
We at Apple are not concerned about the talk of a slowing semiconductor industry. Not the case at all. We think the potential is huge. We believe strongly in both the cloud side, but the future will be a lot of on-device processing. We believe this is the best way to deliver great features without sacrificing the responsiveness and the privacy and the security. We see in our brand-new A11 Bionic chip, which is made right here at TSMC, every time somebody takes a photo, there's over 100 billion operations. That's just mind-boggling. In a single photo, over 100 billion operations. The potential is limitless.

We put a neural engine on the chip, and I won't repeat some of the things that Jensen shared, but we have the same view and vision of the potential of AI to deliver a much safer and efficient autonomous system. The neural engine on our chip has already enabled Face ID, processed locally. And so we view that the next ten years is about the ambition to do what Simon's daughter is asking for, to make life better. And probably one of the most significant examples of this is our opportunity to use transistor technology advances and power scaling to revolutionize healthcare. We think the industry is ripe for change. We think there is tremendous potential to do on-device computing, to do cloud computing as well, and to take that learning, and through machine learning, deep learning, and ultimately artificial intelligence, change the way healthcare is delivered. And we can't think of anything more significant than this.

So I think the question in front of us is "Do we have the right ambitions, and can we go do this?" And there is no such thing as autonomous innovation. Human beings dream it. Human beings drive it. And sure, we'll have deep learning, but there's not autonomous innovation, so it's up to us, this generation over the next ten years, to take advantage of what is in front of us in the silicon world. We at Apple are really inspired, for those of us who started many years ago on a green monochrome computer screen, we're super inspired with the state we're in, and I'll just say this: If in the next ten years, from a society standpoint, we just do a few "gee-whiz" things like flying car kind of dreams, and then the rest of the time we're using the faster chips to do the same things we're doing faster, we will have squandered one of the biggest opportunities in front of us. I think we're at an inflection point, much like my colleagues, with on-device computing, coupled with the potential of AI, to really, really change the world. And we couldn't be more excited about it at Apple, and thank you for your time.
China's Economic Daily News reported that Williams also met with iPhone assembler Foxconn's chairman Terry Gou, but no further details were shared. An earlier report speculated that iPhone X production issues could be one focus.

TSMC provided a live stream of the event that remains available to watch for those who prefer to listen to Williams' comments.


Discuss this article in our forums

TSMC Founder Morris Chang to Retire in June 2018 as Apple’s Chip Partner Plans World’s First 3nm Fab

Apple supplier Taiwan Semiconductor Manufacturing Company has announced today that its founder and chairman Morris Chang will be stepping down from all leadership positions effective June 2018, immediately following the annual shareholders meeting taking place that month (via DigiTimes and Reuters).

Following Chang, TSMC will fall under the dual leadership of Mark Liu and C.C. Wei, with the former executive taking on the chairman of the board position and the latter becoming sole CEO of the company. Chang mentioned personal and family reasons for his retirement, and assured investors that the transfer of leadership would not change TSMC in any way, looking back on his time at the company, which he founded in 1987.

Morris Chang via Wikimedia Commons

Chang is now 86, and has earned a status as the father of Taiwan's chip industry.
Chang added, "The past 30-odd years, during which I founded and devoted myself to TSMC, have been an extraordinarily exciting and happy phase of my life. Now, I want to reserve my remaining years for myself and my family. Mark and CC have been Co-CEO's of the company since 2013, and have performed outstandingly. After my retirement, with the continued supervision and support of an essentially unchanged board, and under the dual leadership of Mark and CC, I am confident that TSMC will continue to perform exceptionally."
The plan of succession is said to have been in the works "for years," with Liu starting as a senior vice president for operations at TSMC and Wei as SVP for business development. Eventually, the two SVPs were promoted to chief operating officers in 2012, and then climbed to each gain a co-CEO status in 2013. Analysts looking at the situation see the two new leaders keeping TSMC's status quo on track "for some years."
“I think Liu and Wei will continue TSMC’s current model for some years,” said Mark Li, an analyst at Sanford C. Bernstein. “I do see the increasing cost of newer generation technologies as an issue but for now TSMC will still maintain the cadence of R&D development.”

But if something new comes up, such as uses of new technology that increases TSMC’s cost, they’ll need to change their plan accordingly, Li said.
One of TSMC's biggest customers is Apple, and the supplier has been connected with Apple's iPhones and iPads since 2011, when reports first began coming out that Apple was looking into diversifying its supply chain. Samsung was the sole supplier of the A5 chip -- which was found in 2011 devices like the iPad 2 and iPhone 4s -- but due to patent-based legal disputes and Samsung's rise as a competitor in the mobile device market, Apple began looking towards other chipmakers from which it could source its A-series chips.

TSMC eventually entered trial production on chips in the A5 and A6 range, but didn't officially make it into production on A-series chips until the A8 in 2014, on the iPhone 6 and 6 Plus. Apple has still sourced some A-series generations from Samsung, most notably -- and infamously -- looking to increase volume for the iPhone 6s launch in 2015 by dual-sourcing chips from both Samsung and TSMC for the A9.

Since then, TSMC was the sole supplier of the A10 chip for the iPhone 7 family in 2016, as well as for the A11 chips in the iPhone 8, iPhone 8 Plus, and upcoming iPhone X. Still, rumors persist that Liu and Wei will face increased competition from Samsung in the chip fabrication space. The TSMC rival is planning to "triple the market share of its contract chip manufacturing business within the next five years by aggressively adding clients," potentially including a return to its previous status as an A-series supplier for Apple, although some analysts disagree.

Read more MacRumors coverage of TSMC over the years:
Simultaneously, TSMC is gearing up to build the world's first 3-nanometer chip production plant in Tainan Science Park in southern Taiwan, marking at least one upcoming TSMC plant that will remain in Taiwan and not be built in the United States (via EE Times). The 3nm production sees TSMC preparing for the release of products far down the line; currently the supplier uses a 10nm FinFET process, with 7nm planned for 2018 and 5nm and 3nm gearing up "as early as 2022."

Tag: TSMC

Discuss this article in our forums

Apple’s Chip Partner TSMC Shares Details on 7nm Node and Advanced InFO Package Process for 2018

At the Open Innovation Platform Ecosystem Forum in Santa Clara on Wednesday, chip foundry TSMC provided an update (via EE Times) on the progress of its forthcoming technology nodes, several of which would be candidates for upcoming Apple chips. Most notably, the company's first 7-nanometer process node has already had several tape-outs (finalized designs) and expects to reach volume capacity in 2018.

TSMC's 10 nm node, which first showed up in Apple's A10X chip in the iPad Pro, followed by the A11, has been fraught with issues (paid link) such as low chip yield and performance short of initial expectations. TSMC looks to change its fortune with the new 7 nm node, which would be suitable for the successor to the A11 chip given current timelines.

In addition to the 7 nm node, TSMC also shared information on the follow-up revision to this node, dubbed, N7+. Featuring the long-beleaguered Extreme Ultraviolet Lithography (EUV), the revision would promise 20 percent better density, around 10 percent higher speeds, or 15 percent lower power with other factors held constant.

While EUV has faced delays for over a decade at this point, it seems to finally be coming to fruition, and a 2019 volume availability update would allow Apple to update its chip process in subsequent years yet again. Apple had previously updated process nodes with every iPhone since the transition to 3GS before being forced to use TSMC's 16 nm node in consecutive years with the A9 and A10. Moving forward, that annual cadence is again in jeopardy as chip foundries deal with the realities of physics and minimum transistor geometry sizes.

TSMC also unveiled some low power and low leakage processes that are suitable for Apple's other custom designs, such as its line of wireless chips like the W1 and successor W2. TSMC is targeting availability next year of a 22 nm ultra low leakage node, which is suitable for analog and RF designs such as cellular basebands or Wi-Fi chips.

This will ultimately help Apple further lower power consumption on the Apple Watch and headphones featuring the W line of wireless chips. It is also likely to be adopted by Qualcomm for its line of modem products. The W1 and W2 manufacturing processes are not currently publicly known, but it is likely that one of TSMC's RF-focused processes powers the Apple chips.

Finally, TSMC announced a revision of its integrated fan-out packaging process (InFO) that is targeted at integrating high bandwidth memory (HBM) into the assembly, dubbed InFO-MS. HBM has generated a lot of interest from applications where very high sustained memory bandwidths are desired, such as consumer graphics cards.

HBM and similar standards such as Wide I/O promise not only to improve memory bandwidth, but also improve power consumption for a given bandwidth, making it a suitable evolution for mobile SoC designs. This type of memory interface has yet to appear in a mobile design, though it should be considered a near-term eventuality. Despite advances in mobile memory, it still lags behind desktop and laptop systems in total bandwidth, which can be important in some tasks such as graphics rendering.

Tags: TSMC, W1, A12, W2

Discuss this article in our forums

Multiple Apple Suppliers Share Revenue Reports Ahead of ‘Peak’ iPhone and Apple Watch Season

A collection of Apple suppliers have shared revenue reports today, which also provide a glimpse into the upcoming "peak" iPhone and Apple Watch manufacturing season. Starting off, Foxconn looked back at its profits in July and reported consolidated revenues of NT$315.06 billion (US$10.62 billion) for the month, which marks an increase of 7.53 percent year-on-year. For the first seven months of 2017, Foxconn's combined revenues were NT$2.2 trillion, increasing by 1.64 percent year-on-year (via DigiTimes).

Those watching Foxconn's revenue report are now expecting the October-December period to be the "peak of 2017" for the company, thanks to its status as one of Apple's biggest suppliers and the launch of the iPhone 8 sometime in September. Foxconn's revenue will increase "gradually" in August, according to market watchers, and will continue until the end of the year. Holiday spending traditionally helps increase Apple and its suppliers' revenue, even boosting Foxconn's December period in 2016 in the face of an overall year that saw its first-ever profit decline.

Check out our recent hands-on with an iPhone 8 dummy model
Some market watchers expect Foxconn's revenues to increase gradually beginning August and the growth will last until the end of 2017 with the fourth quarter being the peak of 2017 for Foxconn.
Apple Watch supplier Quanta Computer announced revenues for the second quarter of 2017 at NT$235.37 billion (US$7.93 billion), growing 3.3 percent from the previous quarter and 13.3 percent from the year-ago quarter. Today's report stated that next-generation Apple Watch shipments will begin in the fourth quarter, gradually increasing Quanta's financial performance in the second half of 2017 -- a sentiment that's been shared in previous supply chain reports due to Quanta's status as the sole supplier of the "Apple Watch Series 3."
With the notebook market entering the traditional peak season, its server shipments expected to enjoy growth and the next-generation Apple Watch set to begin shipments in the fourth quarter, some market watchers expect Quanta's financial performances to gradually pick up in the second half of 2017.
In other supply chain ramp-up stories, TSMC has entered mass production on the iPhone 8's A11 chip in the third quarter of 2017. The next-generation chip is being crafted with a new 10-nanometer FinFET process, and originally began production back in May after a month-long delay. TSMC is also using its 10nm manufacturing process to build the new iPad Pro's A10X processors, and it's predicted the A11 processors will also find their way into the "iPhone 7s" and "iPhone 7s Plus."
In addition, TSMC has already started mass production of 10nm FinFET chips in the third quarter, driven by Apple's orders, the report indicated. TSMC's 10nm FinFET process has been adopted by Apple for its A10X processors for use in its 10.5- and 12.9-inch iPad Pro tablets and A11 chips that will power the upcoming iPhones.
There have been numerous reports from Apple's supply chain in recent weeks, timed ahead of the rumored announcement of the iPhone 8 in September. These include a report centered on Lumentum and "massive" orders it has received for components related to its vertical-cavity surface-emitting lasers. Such technology is believed to be for the advanced camera and 3D sensing features of the iPhone 8.

Last week, all three new iPhones were reportedly entering volume production, and Samsung Display began gearing up to operate seven of its next-generation OLED lines at full capacity earlier this month, all aimed at the iPhone 8. In terms of the main suppliers for Apple's next-generation OLED smartphone, Foxconn, Pegatron, and Wistron are predicted to hit a sales high in the period running from September to November of this year, due to shipments of finished iPhones that will "start gaining momentum" as soon as this month.

Related Roundup: iPhone 8
Tags: TSMC, Foxconn, Quanta

Discuss this article in our forums

TSMC Rumored to Be Sole Supplier of A-Series iPhone Chips in 2018

Earlier this week, a report by The Korea Herald suggested that Samsung Electronics could be returning as a supplier for the so-called A12 chip in 2018's line of iPhones, after being removed from the A-series chip supply chain in 2016 and 2017, years in which Taiwan Semiconductor Manufacturing Company took on all of the orders. Now, industry observers reported upon by DigiTimes are predicting that TSMC is "still likely" to retain its title as the sole manufacturer of A-series chips in 2018.

In today's report, TSMC's integrated fan-out wafer-level packaging technology -- which the supplier uses in its 7-nanometer FinFET chip fabrication -- is looked at as largely superior to any progress made by Samsung in the same field. Samsung is said to be "aggressively vying" for A-series orders from Apple ahead of 2018, but DigiTimes' sources state that even the company's close ties to OLED might not be enough for Apple to add Samsung as a secondary A-series supplier for the reported three iPhones launching in fall 2018.


It is unlikely Samsung will be able to regain application processors orders for Apple's iPhone, as TSMC's in-house developed InFO wafer-level packaging will make the Taiwan-based foundry's 7nm FinFET technology more competitive than Samsung's, said the observers.

Samsung has grabbed Apple's A9 chip orders for the new 9.7-inch iPads introduced earlier in 2017, the observers claimed. TSMC, which is already the sole supplier of Apple's 10nm A11 chips for the upcoming iPhones, will still likely obtain all of the next-generation A-series chip orders for Apple's 2018 series of iPhones with its 7nm FinFET process, the observers said.

TSMC's innovation in backend packaging plays a key role in securing exclusive orders for Apple's processors for the upcoming iPhones, the observers noted.
In Tuesday's report, it was rumored that Samsung Electronics co-CEO Kwon Oh-hyun already made a deal with Apple concerning 2018 iPhone chip production during a visit to Cupertino last month. Otherwise, The Korea Herald's report was light on details, with no clear indication on exactly how many orders Samsung might have gained from such a deal besides believing the company would "share some parts" of A-series chip production with TSMC.

If Apple kept TSMC as the sole A-series manufacturer in 2018, it would mark the third year in a row that the supplier created iPhone chips alone, following the A10 in the iPhone 7 and iPhone 7 Plus, and the A11 in the upcoming "iPhone 8," "iPhone 7s," and "iPhone 7s Plus." Otherwise, a return to dual-sourced A-series chips in 2018 would be the first time Apple made that move since 2015, when both Samsung and TSMC supplied the A9 chip in the iPhone 6s and iPhone 6s Plus, which frustrated some users when TSMC's technology was discovered to boast marginally better battery life.


Discuss this article in our forums

Samsung Rumored to Return to iPhone Chip Production in 2018

Samsung Electronics will return to producing chips for Apple in next year's iPhone lineup, according to a new report today by The Korea Herald. Before, Taiwan Semiconductor Manufacturing Company held the sole supplier responsibility of providing Apple's A10 chip in the iPhone 7, as well as the A11 chip in the upcoming iPhone 8, but now today's report references a "crucial deal" made between Samsung Electronics co-CEO Kwon Oh-hyun and Apple during a visit to Cupertino last month.

According to the report, Samsung managed to close the deal because of the company's decision to purchase equipment solely intended for 7-nanometer chip fabrication for iPhone devices. This move, as well as using Samsung's "close ties on OLED," convinced Apple to reintroduce the supplier into the iPhone chip supply chain. Although details remain vague, The Korea Herald's sources said that Samsung would "share some parts" of the 2018 iPhone orders that have been previously monopolized by TSMC.

According to news reports on July 18, Samsung recently purchased extreme ultra violet lithography machines, the most advanced chip manufacturing equipment, to produce seven-nanometer mobile processors solely for iPhone.

“The CEO could persuade Apple’s top brass taking advantage of their close ties on OLED,” said an industry source. Samsung, the world’s largest mobile OLED maker with a whopping 95 percent market share, is the sole OLED supplier for the upcoming iPhone.
In 2015, Apple dual-sourced the A9 chip from both TSMC and Samsung for the iPhone 6s and iPhone 6s Plus, leading to some blowback from consumers when battery tests were performed and saw the TSMC chips outperform those made by Samsung. To avoid that issue again, and thanks to TSMC's aggressive moves to adopt smaller and more energy efficient manufacturing processes, Apple chose the company as the sole supplier of the A10 and A11 chips.

Now, Samsung is said to be preparing tests for its own chip processing machines, and next plans to "seek final approval from Apple for the chip production" for what will presumably be called the A12 chip. As the sole OLED supplier for the 2017 iPhone, Samsung Display's deal with Apple has placed the manufacturer with providing between 70 and 92 million OLED displays for the upcoming iPhone 8. Apple is predicted to shift to OLED-only iPhone production as soon as 2018 or 2019.


Discuss this article in our forums

Samsung Rumored to Return to iPhone Chip Production in 2018

Samsung Electronics will return to producing chips for Apple in next year's iPhone lineup, according to a new report today by The Korea Herald. Before, Taiwan Semiconductor Manufacturing Company held the sole supplier responsibility of providing Apple's A10 chip in the iPhone 7, as well as the A11 chip in the upcoming iPhone 8, but now today's report references a "crucial deal" made between Samsung Electronics co-CEO Kwon Oh-hyun and Apple during a visit to Cupertino last month.

According to the report, Samsung managed to close the deal because of the company's decision to purchase equipment solely intended for 7-nanometer chip fabrication for iPhone devices. This move, as well as using Samsung's "close ties on OLED," convinced Apple to reintroduce the supplier into the iPhone chip supply chain. Although details remain vague, The Korea Herald's sources said that Samsung would "share some parts" of the 2018 iPhone orders that have been previously monopolized by TSMC.

According to news reports on July 18, Samsung recently purchased extreme ultra violet lithography machines, the most advanced chip manufacturing equipment, to produce seven-nanometer mobile processors solely for iPhone.

“The CEO could persuade Apple’s top brass taking advantage of their close ties on OLED,” said an industry source. Samsung, the world’s largest mobile OLED maker with a whopping 95 percent market share, is the sole OLED supplier for the upcoming iPhone.
In 2015, Apple dual-sourced the A9 chip from both TSMC and Samsung for the iPhone 6s and iPhone 6s Plus, leading to some blowback from consumers when battery tests were performed and saw the TSMC chips outperform those made by Samsung. To avoid that issue again, and thanks to TSMC's aggressive moves to adopt smaller and more energy efficient manufacturing processes, Apple chose the company as the sole supplier of the A10 and A11 chips.

Now, Samsung is said to be preparing tests for its own chip processing machines, and next plans to "seek final approval from Apple for the chip production" for what will presumably be called the A12 chip. As the sole OLED supplier for the 2017 iPhone, Samsung Display's deal with Apple has placed the manufacturer with providing between 70 and 92 million OLED displays for the upcoming iPhone 8. Apple is predicted to shift to OLED-only iPhone production as soon as 2018 or 2019.


Discuss this article in our forums