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Apple is fighting for TSMC capacity as Nvidia takes center stage

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Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#291

Post by schainks »

edm0nd wrote: post #242
tim-tday wrote: post #69

Sneak preview of the TSMC shortage that will sweep the world in 2027 when China takes Taiwan and the TSMC scuttles their chip fabs on the island. I don’t know the hedge to position against this but I’m pretty sure China will make good on its promise.

I'm not sure how true it is or not but I heard that TSMC has the ability to remotely destroy all of their main fab equipment in the event the Chinese are invading Taiwan.

This is correct: https://www.bloomberg.com/news/articles/2024-05-21/asml-tsmc...

The most advanced ASML machines also cost something like $300-400M each and I am willing to bet if configured wrong can heavily damage themselves and the building they are in.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#292

Post by bigyabai »

hinkley wrote: post #263
anoojb wrote: post #138

Earlier quoted context omitted.

So let's say TMSC reciprocated Apple's consistency as a customer by giving them preferential treatment for capacity. It's good business after all. However, everyone knows that good faith reciprocity at that scale is not rewarded. Apple is ruthless. There are probably thousands of untold stories of how hard Apple has hammered it's suppliers over the years. While Apple has good consumer brand loyalty, they arguably tre…

Apple loaned TSMC money in order to build manufacturing capacity back around the M1 era. They’ve done that for a number of suppliers and the “interest payments” were priority access to capacity. Everyone was complaining about how Apple got ARM chips while others had to wait in line. That said, they did that for a sapphire glass supplier for the Apple Watch and when their machines had QC problems they dropped them lik…

> And who tf do you think they’re going to drop TSMC for right now?

Don't look now: https://www.macrumors.com/2025/11/28/intel-rumored-to-supply...

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#293

Post by Macha »

7speter wrote: post #272
philistine wrote: post #266

Earlier quoted context omitted.

Nvidia is famously a pain to work with. Apple vowed never to use their chips, Microsoft and Sony can't get them to make any GPU for their consoles. The only complete package integrator that manages to make a relationship work with Nvidia is Nintendo.

> The only complete package integrator that manages to make a relationship work with Nvidia is Nintendo. And thats probably because Nintendo isn’t adding any pressure to neither TSMC nor Nvidia capacity wise; iirc Nintendo uses something like Maxwell or Pascal on really mature processes for Switch chips/socs.

And also the Switch 1 was just the hardware for a nvidia shield tablet from nVidia’s perspective, without the downside of managing the customer facing side and with the greater volume from Nintendo’s market reach. (Not that it wasn’t more than that for consumers or Nintendo, just talking nvidia here)

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#294

Post by swiftcoder »

bigyabai wrote: post #175
swiftcoder wrote: post #97

Earlier quoted context omitted.

> Regardless of that, fab industry is based on a short and mid term auction-like planning Not a system that necessarily works all that well if one player has a short-term ability to vastly outspending all the rest. You can't let all your other customers die just because Nvidia is flush with cash this quarter...

> Not a system that necessarily works all that well if one player has a short-term ability to vastly outspending all the rest. Well yeah, people were identifying that back when Apple bought out the entirety of the 5nm node for iPhones and e-tchotchkes. It was sorta implicitly assumed that any business that builds better hardware than Apple would boot them out overnight.

> It was sorta implicitly assumed that any business that builds better hardware than Apple would boot them out overnight

It's not "build better hardware" though, it's "continue to ship said hardware for X number of years". If someone buys out the entire fab capacity and then goes under next year, TSMC is left holding the bag

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#295

Post by bigyabai »

tim-tday wrote: post #126
Lio wrote: post #66

Earlier quoted context omitted.

I used to think that. I really don't care about most new phone features and for my laptop the M1 Max is still a really decent chip. I do want to run local LLM agents though and I think a Mac Studio with an M5 Ultra (when it comes out) is probably how I'm going to do that. I need more RAM. I bet I'm not the only one looking at that kind of setup now that was previously happy with what they had..

Apple has made some good progress on memory sharing over thunderbolt. If they could get that ironed out you maybe could run a good LLM on a cluster of Mac minis. Again you cannot today but people are working on it. One guy might have gotten it to work but it’s not ready for prime time yet.

> Apple has made some good progress on memory sharing over thunderbolt

The only reason that Thunderbolt exists is to expose DMA over an artificial PCI channel. I'd hope they've made progress on it, Thunderbolt has only been around for fourteen years after all.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#296

Post by bigyabai »

swiftcoder wrote: post #294
bigyabai wrote: post #175

Earlier quoted context omitted.

> Not a system that necessarily works all that well if one player has a short-term ability to vastly outspending all the rest. Well yeah, people were identifying that back when Apple bought out the entirety of the 5nm node for iPhones and e-tchotchkes. It was sorta implicitly assumed that any business that builds better hardware than Apple would boot them out overnight.

> It was sorta implicitly assumed that any business that builds better hardware than Apple would boot them out overnight It's not "build better hardware" though, it's "continue to ship said hardware for X number of years". If someone buys out the entire fab capacity and then goes under next year, TSMC is left holding the bag

It's not that, either. Low-margin, high-volume contracts are the worst business you can take. It devalues TSMC's work and creates an unnatural downward force on the price of cutting-edge silicon. By ignoring Apple's demands they're creating natural competition that raises the value of their entire portfolio.

It really is about making better hardware. Apple would be out-bidding Nvidia right now, but only if the iPhone had equivalent value-add to Nvidia hardware. Alas, iPhones are overpriced and underpowered, most people will agree.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#297

Post by TeMPOraL »

chuckadams wrote: post #284
jonas21 wrote: post #277

Earlier quoted context omitted.

AI capex may or may not flatten in the near future (and I don't necessarily see a reason why it would). But smartphone capex already has. Like smartphones, AI chips also have a replacement cycle. AI chips depreciate quickly -- not because the old ones go bad, but because the new ones are so much better in performance and efficiency than the previous generation. While smartphones aren't making huge leaps every year li…

> AI chips depreciate quickly -- not because the old ones go bad I've heard that it's exactly that, reports of them burning out every 2-3 years. Haven't seen any hard numbers though.

Lifetime curve is something they can control. If they can predict replacement rate, makes sense to make chips go bad on the same schedule, saving on manufacturing costs.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#298

Post by fragmede »

lukan wrote: post #276
philistine wrote: post #265

Earlier quoted context omitted.

Apple has used both Samsung and TSMC for its chips in the past. Until the A7 it was Samsung, A8 was TSMC, and the A9 was dual-sourced by both! Apple is used to switching between suppliers fairly often for a tech company; it's not that it's too hard for them to switch fab, it's that TSMC is the only competitive fab right now. There are rumours that Intel might have won some business from them in 2 years. I could total…

But wasn't the reason they split with Samsung because they copied the iphone in the perspective of Jobs (to which he reacted with thermonuclear threats)? They did had the expertise building it after all. What would happen, if TSMC now would build a M1 clone? I doubt this is a way anyone wants to go, but it seems a implied threat to me that is calculated in.

Doesn't seem likely, TBH. Nevermind the legal agreements they would be violating, TSMC fabs Qualcomm's Snapdragon line of ARM processors. The M1 is good, but not that good (it's a couple generations old by this point, for one). Samsung had a phone line of their own to put it in as well. TSMC does not.

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#299

Post by eldenring »

bombcar wrote: post #117
roughly wrote: post #92

This article repeatedly cites revenue growth numbers as an indicator of Nvidia and Apple’s relative health, which is a very particular way of looking at things. By way of another one, Apple had $416Bn in revenue, which was a 6% increase from the prior year, or about $25Bn, or about all of Nvidia’s revenue in 2023. Apple’s had slow growth in the last 4 years following a big bump during the early pandemic; their 5 year…

US tech companies aren’t built to be like 3M is/was and able to have their hands in infinite pies. The giant conglomerates in Asia seem more able to do it. Google has somewhat tried but then famously kills most everything even things that could be successful if smaller businesses.

I think this is more of a result of big US tech being extremely productive (with their main competency)

Re: Apple is fighting for TSMC capacity as Nvidia takes center stage

#300

Post by MBCook »

Aurornis wrote: post #215
anoojb wrote: post #138

Earlier quoted context omitted.

So let's say TMSC reciprocated Apple's consistency as a customer by giving them preferential treatment for capacity. It's good business after all. However, everyone knows that good faith reciprocity at that scale is not rewarded. Apple is ruthless. There are probably thousands of untold stories of how hard Apple has hammered it's suppliers over the years. While Apple has good consumer brand loyalty, they arguably tre…

At this scale and volume, it's not really about good faith. Changing fabs is non-trivial. If they pushed Apple to a point where they had to find an alternative (which is another story) and Apple did switch, they would have to work extra hard to get them back in the future. Apple wouldn't want to invest twice in changing back and forth. On the other hand, TSMC knows that changing fabs is not really an option and Apple…

Not all of Apple‘s chips need to be fabbed at the smallest size, those could certainly go elsewhere. I’m sure they already do.

Is there anyone who can match TSMC at this point for the top of the line M or A chips? Even if Intel was ready and Apple wanted to would they be able to supply even 10% of what Apple needs for the yearly iPhone supply?

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