The world’s leading semiconductor foundry has issued a warning predicting that the global chip shortage that’s hurting technology companies the most won’t be resolved anytime soon.


STORY HIGHLIGHTS:

  • TSMC CEO says the global chip shortage will persist into 2022.
  • Intel CEO warned it could take “a couple of years” to abate.
  • TSMC is pouring big money into capacity expansion.

TSMC

TSMC on global chip shortage

Taiwan Semiconductor Manufacturing Company, or TSMC, has booked 19.4 percent more profit in the first quarter. At the same time, the company said that global chip demand continues to outstrip supply as the world has shifted to home working during the pandemic.

Reuters carries the report:

TSMC said it is doing all it can to increase productivity and alleviate a worldwide chip shortage, but that tight supplies will likely continue into next year. TSMC had already flagged ‘multiple years of growth opportunities’ as the COVID-19 pandemic fuelled demand for advanced chips to power devices such as smartphones and laptops.

TSMC is thought to have been commissioned to build Apple’s second-generation Mac chips using its four-nanometre technology. The company will invest $100 billion over the next three years to expand its advanced chip-making capacity in an effort to meet booming demand.

TSMC CEO C. C. Wei:

We have acquired land and equipment, and started the construction of new facilities. We are hiring thousands of employees and expanding our capacity at multiple sites.

On top of that, TSMC’s advanced three-nanometer process technology will enter trial production later this year. Plus, the company has said that it will boost capital spending on advanced semiconductor production and development to about $30 billion this year.

But none of that will be enough to manufacture enough chips for clients so that you can buy a PlayStation 5, get that latest graphics card from Nvidia or enjoy a new electric car. The situation has affected Apple, too—there’s a shortage of mini-LED screens for the next iPad Pro while some iPad and MacBook production is said to have been temporarily halted.

What does TSMC do?

For years now the Taiwanese company has been fabricating custom chips for iPhones, iPads and, recently, Macs that are based on Apple’s advanced in-house designs.

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Aside from Apple, TSMC fabricates the chip designs of other companies including Nvidia, AMD and Qualcomm, to name but a few. In other words, semiconductor foundries make chips for so-called “fabless” companies that design but do not manufacture their own semiconductors.

As the world’s #1 independent semiconductor foundry, TSMC clearly knows what it’s talking about when it cautions that the global chip shortage won’t end in the foreseeable future.