One of TSMC's Biggest Customers Cuts 3nm Wafer Orders As Consumer Demand Deflates

[btarunr]

A major unnamed customer of TSMC has reportedly cut their order for 3 nm wafers. Foundry customers usually place orders for cutting-edge foundry nodes several quarters in advance, in exchange for priority foundry allocations, and preferential rates, while foundries use revenues from these orders to develop the capacity for manufacture these chips. The 3 nm customer could be anyone—Qualcomm, Mediatek, NVIDIA, AMD, or Intel. Order cancellations have reportedly had a domino-effect on the upstream supply-chain of TSMC, hitting suppliers of raw materials, manufacturing equipment, and other consumables. There is an industry-wide slump in demand for consumer electronics and PC hardware, which reflects in the slump in revenues and/or guidance in quarterly financial results releases by prominent companies.



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[cvaldes]

TSMC's biggest customer -- Apple -- isn't listed amongst that group.

Curious.

An inadvertent omission?

 

[Hyderz]

no1 is buying because living costs have sky rocketed and winter is coming... so need money for food and heating

 

[prtskg]

TSMC's biggest customer -- Apple -- isn't listed amongst that group.

Curious.

An inadvertent omission?

My first thought was Apple too but future demand could be from above mentioned companies as they remain behind Apple.

 

[Space Lynx]

the chip industry needs to help their older nodes expand, not as much profit, but will still be some. the car industry still doesn't have enough chips from what I understand.

 

[The Quim Reaper]

There is an industry-wide slump in demand for consumer electronics

..and their answer to this slump?

'Hey everyone, lets put all our prices up by absurd, inflation busting amounts!'

Bunch of greedy, price gouging Twots.

 

[Deleted member 185088]

Probably most are for smartphones, which ironically given that all of them going backwards except maybe Sony.

 

[Space Lynx]

..and their answer to this slump?

'Hey everyone, lets put all our prices up by absurd, inflation busting amounts!'

Bunch of greedy, price gouging Twots.

Just hold out longer, it will all come crashing down.

 

[rotflmao]

A serious price increase would be the perfect solution to this issue. And all other issues too.

 

[Wirko]

the chip industry needs to help their older nodes expand, not as much profit, but will still be some. the car industry still doesn't have enough chips from what I understand.

And it's happening, for the first time in recorded history. At least on nodes like 28 nm and below, maybe not on older ones. There was news recently that TSMC is pushing their customers to transition to 28 nm, known as "the last cheap node", so they can get rid of very old equipment.

 

[ARF]

A serious price increase would be the perfect solution to this issue. And all other issues too.

Sounds like downward spiraling - the less demand, the more you increase the prices, the more you amplify the willingness of people NOT to buy .

 

[N3utro]

no1 is buying because living costs have sky rocketed and winter is coming... so need money for food and heating

If I had to bet i'd say Nvidia was the one, and no one is buying because market is flooded with cryptominers GPUs

 

[DeathtoGnomes]

Sounds like downward spiraling - the less demand, the more you increase the prices, the more you amplify the willingness of people NOT to buy .

thats an ugly spiral that will come to no good.

 

[HTC]

Sounds like downward spiraling - the less demand, the more you increase the prices, the more you amplify the willingness of people NOT to buy .

There's a reason i mentioned this in another topic: undercutting the main competitor MASSIVELY would be a good way to earn profits LATER ON, though it would come @ the price of low profits NOW.

Still, it's a high risk high reward strategy: one that, should it fail, would have SERIOUS economic repercussions.

 

[Bomby569]

all that investment in new fabs is going to be paid by someone, and with clients cutting orders (more should follow), prices will have to go up for TSMC's clients

 

[MarsM4N]

WinFuture is reporting the customer is Intel. Apparently they moved back 3nm orders a year because of collapsing PC business.
Samsung also seems to postpone 3nm. AMD, Nvidia, MediaTek, Qualcomm and Broadcom also most likely won't move to 3nm. Likely only Apple will be in business for 3nm this and the next year.

I bet AMD is also cutting Zen4 production & ramping up Zen3 (esp. 5800X3D). They're flying off the shelfs like crazy, lol.

 

[zlobby]

If I had to bet i'd say Nvidia was the one, and no one is buying because market is flooded with cryptominers GPUs

Makes sense to me.

 

[Fatalfury]

Just like Oil Companies..
If there's no Demand...make one by creating artificial shortages. SO prices will rise up in a few months time.

 

[zlobby]

WinFuture is reporting the customer is Intel. Apparently they moved back 3nm orders a year because of collapsing PC business.
Samsung also seems to postpone 3nm. AMD, Nvidia, MediaTek, Qualcomm and Broadcom also most likely won't move to 3nm. Likely only Apple will be in business for 3nm this and the next year.

I bet AMD is also cutting Zen4 production & ramping up Zen3 (esp. 5800X3D). They're flying off the shelfs like crazy, lol.

Smartphone market is brutal. They need every advantage they can get, so huge doubt that they won't go for 3nm.

 

[Vayra86]

Just hold out longer, it will all come crashing down.

Exactly. Patience....

 

[Bomby569]

Exactly. Patience....

no way, they have practically a monopoly on the high end, they made massive investments in new fabs. They will have to and can increase prices and customers will still need to come to them and pay the sticker price, they have no where else to go to

 

[GunShot]

I mean... seriously, this is super great news! Drain the swamp and the super ~ pumping ~ overvalued abomination companies and staff.

The winners (Apple, etc.) will weather the storm but the crooks (TSMC, AMD, etc.) needs to hold on to something very tight!

It is what it is!

 

[TheinsanegamerN]

My first thought was Apple too but future demand could be from above mentioned companies as they remain behind Apple.

Could be, but also apple publicly came out and announced they were cutting iphone 14 production by 90% due to slumping demand, so......

Apple cuts iPhone 14 Plus production by up to 90% on back of weak demand

According to The Information, citing supply chain sources, Apple has instructed at least one manufacturer in China to immediately stop production of iPhone 14 Plus components while...

www.techspot.com

 

[MrBeasterer]

If Intel listen to us, the customers, they would not have to do over-purchasing and downscaling. They should have done a better job of enabling things like Performance Maximiser across all their existing user base which is huuuggge.

 

[Chomiq]

Could be, but also apple publicly came out and announced they were cutting iphone 14 production by 90% due to slumping demand, so......

Apple cuts iPhone 14 Plus production by up to 90% on back of weak demand

According to The Information, citing supply chain sources, Apple has instructed at least one manufacturer in China to immediately stop production of iPhone 14 Plus components while...

www.techspot.com

On top of that:

China Covid: Area around world's biggest iPhone plant locked down

The move may have an impact on production of the new iPhone 14, which is made at Foxconn's factory.

www.bbc.com