Apple chips are ready to go

Latest update time：2024-03-23

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Today, several big news happened in the semiconductor industry. Let’s summarize it and show it to everyone. These news involve giants such as Broadcom, TSMC and Apple.

It can be seen from these news that Apple seems to be making some different chips.

Broadcom wins big AI chip order

Broadcom shares soared on Thursday on news that the company had secured a new customer for its artificial intelligence chips.

The Palo Alto, California-based company held an investor conference titled "Enabling Artificial Intelligence Infrastructure" on Wednesday. At the event, Broadcom highlighted its custom chip, switch and network chip technologies that are optimized for data centers running artificial intelligence applications.

Broadcom also revealed that it has added a new customer to its artificial intelligence chip business, which produces application-specific integrated circuits (ASICs). The company did not disclose who the new customer is, leading some Wall Street analysts to speculate it could be a major technology company.

Analysts at Citigroup and JPMorgan speculated that the customer was TikTok parent company ByteDance. Other Broadcom AI ASIC customers include Alphabet's Google and Facebook parent Meta Platforms (META).

However, Truist Securities analyst William Stein speculated that the third AI ASIC customer could be Amazon or Apple.

"Management describes this as a consumer (rather than enterprise) AI customer," Stein said in a client note. "Given that such a collaboration would require considerable scale (and likely a history of custom chips), we speculate that the customer is either Amazon or possibly Apple. However, our belief on the matter is only modest."

Broadcom said its custom artificial intelligence chips offer cost and power advantages over graphics processing units (GPUs) from the likes of AMD ( AMD ) and Nvidia ( NVDA ). That's because its chips are optimized for specific workloads.

Broadcom currently expects AI chip revenue to exceed $10 billion in 2024, accounting for 35% of its semiconductor sales. Last year, AI chip sales accounted for about 15% of the company's semiconductor revenue.

TSMC got an urgent order for Apple chips?

Morgan Stanley analysts raised their price target on Taiwan Semiconductor to NT$850 from NT$860 in a report on Friday, saying the company saw "emergency orders" for Apple chips.

The company said the orders could be used for artificial intelligence training, which "could be enough to offset potential cuts in Apple's iPhone processors."

“Based on our recent foundry supply chain checks, we have seen significant growth in demand for TSMC’s InFO-LSI (integrated fan-out, local silicon interposer) capacity, which is primarily used for Apple’s M2 Ultra, which is a custom The chip is already in Apple's high-end Mac PCs (i.e. Mac Studio and Mac Pro)," the bank explained.

The analyst added: “Given the substantial growth in M2 Ultra orders and relatively stable PC terminal demand, we believe that the demand driver for the 5nm M2 Ultra or the future 3nm M3 Ultra may come from Apple’s internal artificial intelligence servers (see report), we believe , it is estimated that it may bring low single-digit revenue to TSMC.”

Despite describing TSMC as a "laggard in the global AI supply chain," analysts maintained an "overweight" rating on the stock and said they see "modest revenue upside" in forecasts for 2025 and 2026 as Apple Accounting for 20% to 25% of the global artificial intelligence supply chain. TSMC revenue.

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