Apple, a name long considered the “favorite” and most important customer of semiconductor giant TSMC, is facing the risk of losing its number one position. Although reports show that the iPhone manufacturer has moved quickly to secure more than half of the initial production capacity of the advanced 2nm process for the upcoming iPhone 18’s A20 and A20 Pro chips, the explosion of artificial intelligence (AI) has completely changed the landscape. A recent source revealed that TSMC may no longer grant special priority in deliveries to Apple, as most of its profits now come from a completely different sector rather than smartphones.
Chip Price Increase Pressure and the TSMC CEO’s Visit
The partnership between Apple and TSMC has long been rumored by the tech community to be a relationship filled with favoritism and privileges. This is entirely well-founded, as the iPhone manufacturer has continuously contributed a massive portion of revenue to the Taiwanese semiconductor giant over many years. There were even reports suggesting the two companies had a secret agreement, where Apple only had to pay for high-quality wafer batches (silicon wafers used for chip production). However, reputable analyst Ming-Chi Kuo refuted this information, clarifying that TSMC does not bear the cost of defective wafers on behalf of Apple.
Nevertheless, we often believe that Apple always receives priority access to TSMC’s most advanced lithography technologies. However, this year may witness a major shift. A leaked source stated that TSMC CEO, Mr. C.C. Wei, personally visited Apple’s headquarters. The purpose of this visit is believed to be to initiate the largest price hike in recent years. The underlying reason is that System-on-Chip (SoC) processors for smartphones are no longer the primary revenue driver for TSMC.
We previously reported that the California “giant” (Apple) accounted for up to 24% of TSMC’s annual revenue in 2024. However, this title was overtaken by NVIDIA in 2025. Now, according to a source from the “Fixed-focus digital cameras” account on Weibo, a shocking revelation has hit Apple as their dominant position is being heavily shaken by the AI wave.
AI Boom Changes TSMC’s Customer Status
Apple seems to be being left behind as the AI craze pushes TSMC’s revenue to new heights. TSMC is reportedly facing a supply shortage for 2nm wafers. With massive demand weighing heavily, the semiconductor manufacturer is said to have been forced to increase prices for its advanced process nodes for four consecutive years, starting from 2026. Although this price hike is not necessarily applied exclusively to Apple, the estimated cost for each A20 SoC unit could reach $280, a figure that implicitly confirms that price increases may have already been applied.
Reports also emphasize that the 2nm process has recorded 1.5 times more tape-outs compared to the 3nm process. This highlights the reality that Apple, Qualcomm, and MediaTek are no longer the only customers in this fiercely competitive market.
At the end of the Weibo post, the source confirmed that NVIDIA is currently TSMC’s largest customer, contributing 13% to the company’s total revenue. Perhaps only when the AI bubble bursts will TSMC return the favor and favor Apple as before. However, the company likely does not see that happening in the near future, as their capital expenditure (CapEx) due to the AI boom is expected to reach an unprecedented record, totaling a massive $52 billion to $56 billion this year. This shows that TSMC is placing a big bet on the future of AI, and Apple will have to accept sharing its position in the global supply chain.
