TSMC shares fell as much as six percent after an analyst and Taiwanese media reported that Apple and Qualcomm were going to buy their next generation chips from elsewhere.
This is bad news as TSMC reported its highest quarterly profit since the end of 2006, and said it expected revenue to grow at least a record 20 percent this year. But its outlook was based on increased demand from Apple which recently chose TSMC over Samsung to make the majority of chips for the successor to its iPhone 5 series of smartphones.
But it looks like Apple and Qualcomm will likely buy a larger proportion of 14 nanometer smartphone chips from Samsung rather than TSMC beginning in the second half of 2015.
KGI Securities analyst Michael Liu said in a note to clients that he found that tasty bit of gossip following an investor conference held after TSMC reported second-quarter earnings.
The Commercial Times on Thursday, citing market speculation, said Qualcomm has already started working with Samsung to develop the chips. The Economic Daily News said without citing sources that Qualcomm had placed orders with Samsung.
However the rumours are not believed by everyone. Quanta Securities Analyst George Chang, who also attended the conference, said this was just a lot of speculation as no one has even seen the iPhone 6 yet, so it’s too early to say anything about future products.
During the conference, TSMC Chairman Morris Chang admitted that the company’s market share in 16 nanometer chips – which perform similarly to 14 nanometer chips – will be smaller than “a major competitor” next year, and that TSMC will claw it all back the year after.
