On March 14, Daiwa Securities' Rick Hsu and Olivia Hsu came out and directly contradicted all previous rumors supporting the position that Samsung had already won Apple's A9 business and claimed that it was TSMC that would win the bulk of Apple's business. Today supply chain news is supporting that position.

Taiwan Semiconductor Manufacturing Company (TSMC) will remain the major processor supplier for Apple in the second half of 2015 as the foundry will supply 20nm chips for an upcoming 6C model and 16nm FinFET chips for 6S models, according to industry sources.

TSMC is reportedly the sole supplier of processors for Apple's iPhone 6 and 6 Plus, which industry observers believe are the bestselling iPhone models of all time. Strong demand for the 6 and 6 Plus has boosted TSMC's sales generated from 20nm process technology.

TSMC has reported record revenues for January 2015, and guided its first-quarter revenues will register flat sequential growth despite seasonal factors. This supports our report this week titled "Apple's iPhone Mania Still Hot in Q1 while Android Demand Falls."

Growth in TSMC's 20nm business is expected to continue in the second half of 2015, as the foundry will supply chips for a 4-inch iPhone model tentatively dubbed the iPhone 6C, the sources noted.

Shipments of the iPhone 6C, which will launch as the entry-level product for the brand with a price tag between US$400-500, are expected to reach 10-20 million units in the first year after its release, the sources estimated. The news of such a model confirms our March 11 report titled "Apple is Working with Intel on a New Special Smartphone for Emerging Markets."

Meanwhile, TSMC will supply a portion of processors for the iPhone 6S and 6S Plus models, using its 16nm FinFET technology, the sources indicated.

The sources identify Samsung Electronics as the other processor supplier for the upcoming 6S models. Samsung had long been the sole provider of Apple's A-series chips until it lost out to TSMC for the A8 series used in the iPhone 6 and 6 Plus.

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