Semiconductor market research firm IC Insights predicted yesterday that TSMC's sales would jump 32% year-over-year in the second half of 2019. The firm expects the rest of the integrated circuit market's sales to rise by 10% in that same period, meaning that TSMC'could experience growth at over three times the rate of the rest of the market. Much of that extra growth can be attributed to the popularity of processors made with its 7nm process.
That popularity was no secret: DigiTimes reported earlier this month that the lead time for TSMC's 7nm chips tripled from 2 months to 6 months because of high demand. The publication followed up that report today with a new one claiming TSMC had told its clients to book their 7nm capacity for the entirety of 2020. We wouldn't be surprised if companies are forced to fight over increasingly limited supplies.
IC Insights said it expects TSMC to make $8.9 billion in revenue from 7nm chips this year. That's 26% of its total sales in 2019 and 33% of its revenue for the fourth quarter. The firm attributed much of those sales to Apple and Huawei, which have added 7nm processors to their latest smartphones. But TSMC's client list also includes AMD, Nvidia and other major tech companies looking to improve their products' capabilities and power efficiency.
But this could be nothing compared to what happens when TSMC introduces the 5nm process. IC Insights said that companies have been quicker to adopt new process technologies: "It took eight quarters for the foundry’s 40-45nm technology to secure greater than 20% of its total sales, five quarters for its 28nm process to exceed that threshold and only three quarters for its 7nm process to account for more than 20% of its quarterly revenue."
The firm noted that "strong demand for the advanced nodes has resulted in tight supply and longer lead times." (Which matches what DigiTimes reportedly heard from its anonymous industry sources.) TSMC is reportedly "already planning to set aside more funds to expand capacity for its advanced processes" in response. For now, at least, the company will simply reap the benefits of other manufacturers vying to get their hands on its chips.
