Graphics card and CPU vendors may be left fighting over 7nm scraps. Nikkei Asian Review reported today that Apple told suppliers to increase production of the iPhone 11, iPhone 11 Pro and iPhone 11 Pro Max by 10%, due to higher-than-expected demand. That comes out to roughly 8 million additional units--all of which rely on the custom A13 Bionic chip manufactured using TSMC's already-strained 7nm process.
AMD and Nvidia both source 7nm chips from TSMC. DigiTimes reported in mid-September that TSMC had to increase lead time for that silicon from two months to six months. A few weeks later, DigiTimes reported that TSMC advised customers to get in their orders for the entirety of 2020. Some of the world's largest tech companies would have to predict demand for their products more than a year in advance.
That's why it came as little surprise when research firm IC Insights said it only took three quarters for 7nm chip sales to make up more than 20% of TSMC's quarterly revenues. IC said TSMC was "already planning to set aside more funds to expand capacity for its advanced processes" because "strong demand for the advanced nodes has resulted in tight supply and longer lead times." We suspect those problems will get worse before they get better.
TSMC is Apple's primary fab and is tasked with manufacturing the A13 Bionic. Apple's purported order for another 8 million smartphones probably won't help matters. Nikkei Asian Review said the company was originally conservative with orders related to the latest iPhone models. Demand has apparently surpassed expectations, though, especially for the base model iPhone 11 and iPhone 11 Pro (Apple reportedly told suppliers to make fewer iPhone 11 Pro Max units).
That could pose a problem for TSMC's other customers as they pursue their own 7nm ambitions. AMD uses the manufacturer's chips in its Ryzen 3000 CPUs and Navi graphics cards. Nvidia has said that it will source its first 7nm graphics cards from both TSMC and Samsung. Enthusiasts might not typically care much about the new iPhone, but that might change if next-gen graphics or CPU supplies are impacted by Apple's latest.