TSMC pretty much confirms it’s an iPhone 12 supercycle

This is the hugest pile of iPhones you can imagine — think how many hours of work and development it represents.

Apple’s chip manufacturer, TSMC, confirmed its highest ever quarterly profit and raised its revenue and investment spending estimates on strength of what it states it sees will be “multiple years of growth”.

iPhones, iPads, Macs and more

The supplier now makes chips for almost every single Apple product, from iPhones to Macs.

TSMC makes these chips for Apple, and as a result of the strong sales it has increased its investments in future chip production capability to a level 60% higher than in 2020. That’s particularly important as we think Apple plans to migrate to smaller and faster chips in future.

Chip demand globally is climbing as processors become important across a wider field of products – what use to be used inside computers are now inside every single connected device. This has caused some manufacturers to reduce production plans.

TSMC generated $5.1 billion in Q4 2020. That’s in the same period as we saw Apple launch new iPhones, Apple Silicon Macs and more.

Working hard in the Apple distribution centre

Gathering momentum

TSMC predicts further spikes in demand moving forward, propelled by the need to work from home and industry investments in IoT, cloud and 5G.

“Moving into first quarter 2021, we expect our business to be supported by HPC-related demand, recovery in the automotive segment, and a milder smartphone seasonality than in recent years,” said TSMC CFO Wendell Huang.

The latest CIRP data shows iPhone 12 boom

Boosting supercycle certainty?

This is almost certainly good news when it comes to Apple’s iPhones 12 sales, lending further substance to expectation of a supercycle in terms of sales of the new Apple smartphone.

We should learn a little more on this during Apple’s fiscal results conference call, January 27, 2021.

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