Apple A12 and Snapdragon 700 Chip Production May Lead TSMC to Earn Record Profits in 2018 After All

Last week, Apple supplier TSMC saw its shares decline around nine percent after it cut its full-year revenue growth target to 10 percent, compared to its previous 10-15 percent estimate. The manufacturer blamed the cut on lower-than-expected smartphone demand and growing uncertainty in the cryptocurrency mining market.


Apple's stock also declined around four percent on Friday, as many analysts equated the slowing smartphone demand with poor or declining sales of the iPhone X, which has an A11 Bionic chip fabricated by TSMC, in the second quarter.

Now, a report from DigiTimes suggests that TSMC may post better-than-projected revenues and profits in 2018 after all, as it gradually ramps up volume production of so-called A12 chips for Apple's next-generation iPhone lineup. The wafers are expected to be manufactured based on TSMC's advanced 7nm process.
The sources said that TSMC will see its revenue ratio for advanced 7nm process hit a high of 20 percent in 2018, and may therefore post better-than-projected revenues and profits for the second half of the year and register an annual revenue growth of over 10 percent.
TSMC may also benefit from Qualcomm's decision to roll out its new Snapdragon 700 series processors in May, ahead of schedule, according to the report. Qualcomm has allegedly grabbed significant orders from non-Apple smartphone vendors and will have TSMC fabricate the chips in the second half of the year.

The report is questionable given that TSMC presumably factored in production of A12 chips into its revenue guidance last week, but the better-than-projected revenues could rest more on the Qualcomm portion of the news.

How much money TSMC makes is a data point that Apple analysts often attempt to interpret in order to gauge iPhone sales. A constant flow of reports have claimed iPhone X sales have significantly declined following the device's late 2017 launch quarter, but Apple has yet to disclose any official figures.

Apple will report its second quarter earnings results on Tuesday, May 1, including how many iPhones it sold during the January-March period, but it doesn't provide a model-by-model breakdown of sales. Apple reported record-breaking revenue of $88.3 billion and 77.3 million iPhone sales in the first quarter.



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15 months ago
Yeah okay. Just make your software better so we can actually feel the full benefits of these chips. An iPhone 8 doesn’t really run that much faster than an iPhone 6S. I don’t really care about some numbers on a geekbench, doesn’t impress me as much anymore.
Rating: 7 Votes
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15 months ago
A12: So powerful, you need a new battery in less than 12 months.
Rating: 5 Votes
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15 months ago
I think it’s time we get 0% improvement in speed but use all the efficiencies of the new manufacturing process for battery life gains.

Who’s with me? :D
Rating: 4 Votes
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15 months ago
Last week, TSMC lowered their revenue guidance due to soft demand for a “very high end smartphone” according to the CEO.

TSMC bet on iPhone X and lost. I really doubt Digitmes knows more than TSMC themselves and this far ahead of time.
Rating: 2 Votes
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15 months ago

Last week, TSMC lowered their revenue guidance due to soft demand for a “very high end smartphone” according to the CEO.

TSMC bet on iPhone X and lost. I really doubt Digitmes knows more than TSMC themselves and this far ahead of time.


Absolutely ridiculous. The iPhone 8/8P also use the A11 processor. Apple posted record sales the previous quarter (Q1 2018) and their guidance is for a record breaking Q2 2018 as well. There’s no “soft demand” for the A11.
Rating: 2 Votes
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15 months ago

Last week, TSMC lowered their revenue guidance due to soft demand for a “very high end smartphone” according to the CEO.

TSMC bet on iPhone X and lost. I really doubt Digitmes knows more than TSMC themselves and this far ahead of time.

How do we now it’s the X and not the Samsung 9, which by all accounts is a soft seller?
Rating: 2 Votes
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15 months ago

How do we now it’s the X and not the Samsung 9, which by all accounts is a soft seller?


Because we know that Timmy was caught lying saying the X was the best selling iPhone ever when at the same time he was slashing production! You cannot have it both ways. :D
Rating: 1 Votes
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15 months ago

Last week, TSMC lowered their revenue guidance due to soft demand for a “very high end smartphone” according to the CEO.

TSMC bet on iPhone X and lost. I really doubt Digitmes knows more than TSMC themselves and this far ahead of time.


How do we now it’s the X and not the Samsung 9, which by all accounts is a soft seller?


Follow the bread crumbs.... Apparently Samsung also underperformed when Apple reduced its orders for OLED displays.

Apple is profiting for certain, but we will know more when Apple next reports units sold. Still, based on all of the reports around the web, it would seem to me that while Apple may be moving an adequate volume of lower priced iPhones, the iPhone X has not sold as well as anticipated. Apple's profit margin on the X vs its other models will make any analysis based on total units difficult, however.

Because Apple does not break down the unit sales by model, the real evidence may have to be inferred from the new iPhone lineup, i.e. How many iPhones sport OLEDs.
Rating: 1 Votes
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15 months ago

Uh the US and Chinese versions have a Snapdragon 845, which is not Samsung’s Exynos 9810 (which is used internationally).

The Snapdragon is made by TSMC, hence the question I asked. With the S9 flopping spectacularly how do we know the hit to TSMC is from the iPhone X (which is selling well) and not the lackluster s9 sales numbers?


Good point on the Snapdragon - I was thinking only of the Exynos. And it looks like the 855 is going to be TSMC also, so you're right that any revenue miss could very well could be due to soft demand from *those* phones.
Rating: 1 Votes
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15 months ago

Yeah okay. Just make your software better so we can actually feel the full benefits of these chips. An iPhone 8 doesn’t really run that much faster than an iPhone 6S. I don’t really care about some numbers on a geekbench, doesn’t impress me as much anymore.


They would probably have to slow down the old phones to make the new ones feel faster. :(
Rating: 1 Votes
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