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All TSMC Plants were Hit by an Unknown Computer Virus which Temporarily Shut down Production

1 cover TSMC 7NM PLANT

Report Update August 6, 2018, 3:40 a.m.


It was officially reported in Taiwan this morning that a computer virus halted several Taiwan Semiconductor Manufacturing Co. factories Friday night, dealing the company one of its most severe disruptions as it ramps up chip making for Apple Inc.'s next iPhones and other key products.


The sole maker of the iPhone's main processor said a number of its fabrication tools had been infected, and while it had contained the problem and resumed some production, several of its factories won't restart till at least Sunday. The virus wasn't introduced by a hacker, the company added in a statement.


It's unclear who targeted TSMC, the world's biggest contract manufacturer of chips for companies including Apple and Qualcomm Inc. It's the first time a virus had ever brought down a TSMC facility, recalling the WannaCry cyberattacks of 2017 that forced corporations around the world to suspend operations as they rooted out the ransomware. TSMC is working on solutions now but said the degree of infection varied from factory to factory, and that it will provide more information Monday after it's assessed the situation.


"TSMC has been attacked by viruses before, but this is the first time a virus attack has affected our production lines," Chief Financial Officer Lora Ho told Bloomberg News by phone. She wouldn't talk about how much revenue it would lose as a result of the disruption, or whether the facilities affected were involved in making iPhone chips.


"Certain factories returned to normal in a short period of time, and we expect the others will return to normal in one day," the company said in its Saturday statement. Source: Bloomberg


A second report from Taiwan noted today that "TSMC said the losses resulting from the virus attack are limited, so it is not necessary for the company to hold a news conference to detail investors based on the current law. The company only needed to post a written statement about the incident on the TWSE website."


A third report, this time from the Nikkei Asian Review, added that "TSMC said the degree of infection varies from site to site and that "certain factories returned to normal in a short period of time." The chip giant, based in the Taiwanese city of Hsinchu, expects other plants to return to normal in a day.


All production sites in Taiwan, TSMC's primary production base, have been disrupted by the virus, according to the company.


"It's extremely sensitive," an industry source familiar with the matter said on condition of anonymity. "The news has spread across the industry since late Friday night. The computer virus was first detected in TSMC's 12B facility."


The source said this facility is TSMC's most essential research and development base and is near the company's headquarters. The R&D plant "holds crucial production data and leading nanotechnology blueprints," the source said.


The virus attack on TSMC's computer systems also comes as trade tensions and a technology cold war escalate, mostly between Washington and Beijing. Nation-states increasingly consider their private sectors' chip technologies to have deep national security implications."


Update August 6, 2018, 3:40 a.m.: Digitimes has posted a report this morning titled "Apple reportedly among affected 7nm clients in TSMC virus incident. It seems to be a report to catch up with the weekend news and perhaps hype it up for clicks with Digitimes using Apple in the byline. Nothing of any consequence was actually proven to advance our original Saturday story or shed light on Apple specifically. Patently Apple has decided not to post a separate report to hype up clicks.


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