14 DAY TRIAL // After confirming a deal between Apple Inc. and Taiwan Semiconductor Manufacturing Company to make next-generation iDevice chips, WSJ is following up with a report that explains what TSMC has to go through to satisfy Apple.
It’s pretty much a given that the new contract will give TSMC a boost in profits, but the Taiwanese chip maker will also need to adopt “costly new manufacturing technology” to make Apple’s A-series chips, analysts said, according to WSJ.
Credit Suisse analyst Randy Abrams is cited as saying, “The deal would represent an important new leading-edge customer for TSMC to help support the expensive R&D and capex investment requirements TSMC needs to make on the more advanced technology nodes.”
Apple’s chip orders will account for about 8% of TSMC’s total revenue in 2014, Abrams estimates. Apple in 2014 is expected to launch the iPhone 6, as well as several new iPads.