Apple recently filled the Taiwanese Semiconductor Manufacturing Company (TSMC)’s 5nm production capacity through the end of 2020, reports DigiTimes. The iPhone maker placed a new order with the foundry for chipsets that will power its hotly anticipated new products.
Apple is TSMC’s biggest client and spent $8.2 billion on its silicon offerings last year.
Why Apple is Ordering So Many 5nm Chips
Apple is moving to acquire large quantities of TSMC-made chipsets to keep its new unveiled hardware in stock.
One of the main reasons Apple is a $2 trillion company is its ability to generate and capitalize on consumer interest quickly. The corporation’s practice of staging buzzworthy presentations and then selling its new featured products shortly thereafter has been useful for decades. But its strategy only works if it has enough inventory available to meet demand.
If it falls short, the company risks alienating consumers that have made it one of the world’s valuable enterprises.
According to DigiTimes, the company received a raft of pre-orders for its revamped iPad Air following its latest launch event. As a result, the firm increased its 5nm chipset orders to ensure its tablet will remain available.
In addition, Apple is going to launch its first series of 5G-enabled iPhones sometime later this year. Though the company has not announced a release date for its new mobile devices, it reportedly plans to ship 75 million units in 2020.
By filling the last opening in TSMC’s 5nm near-term production capacity, Apple ensures its flagships will be on sale during the holiday season.
Too Much is Never Enough
Despite adding $1 trillion to its market capitalization in just two years, Apple has no plans to slow its growth. And to facilitate its future expansion, the company plans to ramp up its electronic components manufacturing.
In July, the Cupertino, California-based company announced it would develop its own computer processors using ARM architecture. China News recently reported the first products to feature the firm’s self-made graphics cards and processors would debut next year. Like the rest of Apple’s first-tier lineup, its forthcoming Mac and iPad Pros will feature 5nm chipsets.
Because of the power and energy efficiency upgrades 5nm components offer compared to the prior generation, Apple’s new products will stand out. The corporation will likely use the improved performance and novelty of its new offerings as marketing hooks.
Consequently, Apple’s market value, and its utilization of TSMC’s production line, will reach new heights next year.