Taiwan Semiconductor Manufacturing Co. strengthened its position as Apple Inc.’s primary chip supplier by securing orders for multiple components in the new iPhone 16e, including the device’s processor and first-party 5G modem.
The world’s largest contract chipmaker will produce Apple’s A18 processor using its second-generation 3-nanometer technology, while also manufacturing the new C1 modem chip across its 4nm and 7nm nodes. The expanded partnership marks TSMC’s deepening role in Apple’s semiconductor strategy as the US tech giant moves to reduce its reliance on Qualcomm Inc.
Industry analysts estimate the iPhone 16e could generate shipments of 22 million units annually, providing TSMC with substantial orders across multiple process nodes. The chip manufacturer’s advanced packaging technology, specifically its integrated fan-out (InFO-PoP) solution, will be used for the A18 processor.
Supply chain sources indicate Apple plans to extend its custom modem deployment across its product lineup by 2026, potentially offering TSMC additional revenue streams from Apple’s watches, iPads, and eventually Mac computers. The semiconductor maker is expected to produce Apple’s second-generation modem, codenamed “Ganymede,” using 3nm technology next year.
The new iPhone 16e, priced at $599, represents Apple’s push into AI-capable smartphones at lower price points. While competitors Qualcomm and MediaTek Inc. already offer integrated modem solutions, Apple’s transition to custom silicon could reshape the mobile chip industry’s competitive landscape.
TSMC’s growing involvement in Apple’s semiconductor strategy comes as the chipmaker expands its manufacturing presence globally, with new facilities under construction in Japan, Germany, and the United States.
