Taiwan Semiconductor Manufacturing Company (TSMC) has seen 7nm chip orders ramp up and the process capacity utilization rate start picking up recently, according to industry sources.

With handset chip clients stepping up their pace of advanced chip orders, TSMC is expected to see its 7nm manufacturing processes run at full utilization in the third quarter of 2019, the sources indicated.

TSMC's 7nm process technology has been adopted for the production of new-generation CPUs, GPUs, artificial intelligence (AI)-related solutions and server chips slated for launch this year, according to sources at first-tier handset SoC companies. Among TSMC's 7nm chip clients, HiSilicon and AMD have been ramping up their wafer starts aggressively.

Qualcomm and MediaTek are both keeping a close eye on TSMC's 7nm process utilization rate, and are expected to follow suit demanding more wafer starts at TSMC later in the second quarter, the sources said. And with orders for the new-generation iPhone set to occupy the majority of TSMC's available 7nm process capacity in the third quarter, the pure-play foundry will enjoy a substantial rise in the process capacity utilization during the quarter, the sources continued.

TSMC's 7nm process utilization rate might have hit the lowest for 2019 in the first quarter, according to the sources.

A pick-up in 7nm process utilization may lead to a particularly strong second quarter of 2019 for TSMC, according to market sources. The pick-up is driven mainly by a ramp-up in chip orders for new Android devices.

In addition, TSMC has kicked off volume production of chips built using an enhanced 7nm with EUV node at the end of March, the sources noted. The foundry is expected to enter mass shipments of EUV-based 7nm chips in the second half of 2019.

Overall, 7nm chip orders will be critical in determining TSMC's revenue growth this year.

By: DocMemory
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