Earlier this morning Patently Apple posted a report titled "Apple's Chip Partner TSMC to report their Financials on Thursday and Analysts are expecting a strong Quarter due to iPhone 12 and more." The good news for TSMC and the semiconductor industry as a whole was highlighted in a new report from Counterpoint stating that the sector delivered above-expectation revenue growth in 2020. With tightening supplies from most global vendors, they expect 2021 to continue this momentum.

In addition to a favorable macro environment, such as leading to logistical challenges and trade tensions prompting increase in wafer bookings, the technology migrations in leading-edge nodes (7-nanometer and 5-nanometer) appear to be accelerating to meet the demand from 5G smartphones, game consoles and AI/GPU in cloud servers. On the other hand, new capacity additions across the industry remain rational, with the second-tier foundry vendors preferring to raise wafer prices against building greenfield fabs.

In respect to 5nm processors, TSMC and Apple were the leaders in 2020 with the A14 for the iPhone 12 and Apple Silicon.

Counterpoint notes that "TSMC started its 5nm mass production from Q1 2020, and Samsung followed after 6-9 months. 5nm is considered a fully adopted EUV node for both foundries as Intel’s equivalent 7nm announced another delay in production last year.

Based on our estimates, the total wafer shipment volume of 5nm will account for 5% of 12-inch wafers in the global foundry industry in 2021, up from less than 1% in 2020.

Apple is the top customer (with all orders to TSMC) in 5nm this year (see Exhibit 1), including both for iPhones (A14/A15) and the newly released Apple Silicon. The Counterpoint chart below shows that they expect Apple to take 53% of the 5nm chip market in 2021.

(Click on image to Enlarge)

Qualcomm will be the second-largest 5nm customer as the iPhone 13 may adopt its X60 modem.

TSMC is expected to book $10-billion revenue from 5nm in 2021. Samsung Foundry will also gain good traction from 5nm order wins, including its in-house (Exynos) SoC and Qualcomm.

Review Counterpoints full report on their forecast for 2021 here.