TSMC Rides AI Wave to Offset iPhone Sales Slump TSMC, the renowned chipmaker for Apple, has successfully navigated through a dip in iPhone demand by capitalizing on the rising need for artificial intelligence (AI)-driven processors.

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Taiwan Semiconductor Manufacturing Company (TSMC), known for its integral role in producing chips for Apple’s iPhones, has showcased a resilient financial performance in Q4 of 2023.

Despite facing a downturn in demand for smartphones and laptops, leading to an accumulation of processor stockpiles, TSMC has bounced back, thanks in large part to the burgeoning sector of artificial intelligence.

This shift in demand dynamics marks a significant turn for the company, which had experienced a profit decline by mid-2023.

Bloomberg reports that although the much-anticipated iPhone 15 did not significantly boost TSMC’s earnings, the company still matched its revenue from the same quarter in the previous year. TSMC’s earnings reached an impressive NT$625.5 billion ($20.13 billion), slightly surpassing analysts’ expectations of around $19.83 billion.

This feat is particularly notable considering the general slump in the smartphone market.

C.C. Wei, TSMC’s CEO, expressed confidence that the issues with processor stockpiling have largely been mitigated. A key contributor to this resurgence is the increased demand for high-performance processors driven by AI technologies, particularly from companies like Nvidia and AMD.

Wei’s insights suggest a strategic pivot for TSMC, diversifying its reliance away from smartphone manufacturers and towards other burgeoning tech sectors.

While the specific sales breakdown for 2023 remains undisclosed, and the proportion of earnings attributable to Apple is unknown, there are indicators that the iPhone 15 has made a significant impact in the otherwise sluggish smartphone market.

Amidst these developments, TSMC is not resting on its laurels. The company is actively expanding its global footprint, with ongoing projects in Germany, Japan, and Arizona.

This expansion not only reinforces TSMC’s position as a leading chip manufacturer, but also signals its readiness to meet the diverse and evolving demands of the global technology market.

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