Apple bitten as TSMC hikes prices

Apple has reportedly agreed to price hikes from Taiwan Semiconductor Manufacturing Company (TSMC) and ordered up to 150,000 4nm chips for its new processor, according to Taiwan media Commercial Times.

Apple has finalized the design of its next-generation A16 processor, which will use TSMC's 4nm chip and is expected to start mass production in the second half of the year, according to the report.

Apple has accepted the price rise to ensure production capacity amid the chips shortages and has contracted with TSMC to produce 120,000 to 150,000 units, the report said

The increase will be lower than what TSMC will charge others as Apple is its largest customer, the report added.

This came as the research firm MorningStar lifted its fair value estimate on TSMC,to TWD 990 (HK$280) per share due to increases in its five-year revenue compound annual growth rate, which it expected to reach 16.5 percent, and up to 1.5 percentage points change in gross margin assumptions.

These changes mainly stem from MediaTek's entry into the premium chipset in 2022, a stronger pipeline of high-performance computing and demand and increasing certainty from autonomous driving thereafter.

Staff reporter