Taiwan Semiconductor Manufacturing Company (TSMC) will likely allocate capacity of 1.8 million wafers for production of Qualcomm chips in 2011, compared to the 1.1 million units reserved in 2010, according to industry sources. The additional 700,000 includes 300,000-400,000 for solutions used in Apple's devices, the sources speculated.
Qualcomm reportedly will provide baseband chips for Apple's upcoming iPhone 5 and iPad 2.
Orders placed by Qualcomm are expected to contribute around NT$20 billion (US$664 million) to TSMC's overall sales in 2011, the sources said.
In addition, Broadcom, NXP Semiconductors and Texas Instrument (TI), which reportedly are also among the chip suppliers for the next-generation iPhone and iPad devices, also produce their chips at TSMC, the sources indicated.
TSMC's consolidated revenues for 2011 are forecast to grow 15-18% from the NT$420 billion estimated for 2010, according to the sources.
TSMC chairman and CEO Morris Chang was quoted as saying in previous reports that the company's sales for the first quarter of 2011 will drop by up to 5% or remain flat compared to the prior quarter. Market watchers view a pull-in of orders from Qualcomm as a key contributor to its particularly-strong first quarter.