Reports show that TSMC's 3nm chip business is expected to achieve significant growth in 2024, with annual revenue expected to grow by 34%, thanks in part to Apple's increased orders for A18 and A18 Pro chips. Apple uses the A16 Pro chip in its latest releases, the iPhone 16 Pro and iPhone 18 Pro Max, which are powered by TSMC's second-generation 3nm process technology. According to Wccftech, Apple may prepare up to 100 million A18 chips for the iPhone 16 series to cope with the potentially high demand, which will bring significant revenue growth to TSMC. In addition, Qualcomm and MediaTek will also launch their own 3nm SoCs to compete with the A18 and A18 Pro, which will further drive TSMC's 3nm process business growth.
Apple uses the A16 Pro chip in its latest iPhone 16 Pro and iPhone 16 Pro Max, which uses second-generation 3nm technology to deliver unprecedented energy efficiency. With a 16-core Neural Engine, a 6-core CPU, and a 6-core GPU, the A18 Pro chip delivers a 15% increase in speed and a 17% increase in total system memory bandwidth compared to the previous generation A17 Pro. CPU performance is up to 15% while power consumption is reduced by 20%, while GPU performance is up to 20%. These performance improvements, combined with larger caches, next-generation machine learning accelerators, and support for advanced media features such as ProMotion and Always-On Display, make the A18 Pro chip the world's first mobile phone chip to feature second-generation 3nm transistor technology, bringing users a better user experience and better price/performance ratio.
Figure: Thanks to the increase in orders for A18 and A18Ppro, TSMC's 3nm chips have increased their income (Source: Wccftech)
TSMC's 3nm process technology, also known as N3E, is favored by the market for its higher yields and slightly better energy efficiency than the more expensive N3B process. As Apple, as well as other major customers such as AMD and Intel, begin to adopt this process, TSMC's 3nm products are expected to flood the high-end technology market in 2024. TSMC's 3nm business could account for 20% of the company's total revenue in 2024, making it the second most popular process node after the 5nm process, according to Extremetech.
As the demand for AI chips continues to grow, TSMC's revenue and profit in the first quarter of 2024 exceeded expectations. The Company expects 2024 to be a "healthy year of growth", supported by its technology leadership and broader customer base. TSMC expects revenue in the second quarter of 2024 to be between $19.6 billion and $20.4 billion, reflecting the market's continued demand for advanced chips, especially chips for AI applications.
In summary, TSMC's 3nm chip business is expected to achieve significant growth in 2024, thanks to increased orders from Apple Inc. and other major customers, as well as the continued growth in demand for AI chips. As TSMC continues to expand its production capacity for advanced process technologies, the company expects to continue to maintain its leading position in the high-end chip market.
