iPhone 7 Chip Manufacturer Counts Cost of Earthquake Damage - MacRumors
Skip to Content

iPhone 7 Chip Manufacturer Counts Cost of Earthquake Damage

by

The sole company responsible for manufacturing the processor in Apple's upcoming iPhone 7 and iPhone 7 Plus has reduced its shipping estimates after its facilities were damaged in an earthquake (via DigiTimes).

Taiwan Semiconductor Manufacturing Company (TSMC) suffered the damage to its plants on February 6 when a 6.4-magnitude quake struck the southern part of the country.

Initially, TSMC reported that the damage incurred would reduce the amount of chips it could ship by less than 1 percent. However, this morning the company revised that estimate and said shipment numbers could be affected over the 1 percent mark, but stopped short of giving a specific number.

iphone_7_render_mr

Mockup of iPhone 7 case showing flush rear camera and no antenna bands across rear

Despite the earthquake, TSMC stated it is confident of hitting target revenues of $5.9-6.0 billion in the first quarter of 2016. Whether the damage will affect production of the iPhone 7 chip, which is expected to begin in June, remains unclear.

TSMC reached a deal with Apple only last week to become the sole manufacturer for the iPhone 7's processor, partly thanks to its 10-nanometer manufacturing process. Apple used both Samsung and TSMC to manufacture the chips for the iPhone 6s, perhaps in a bid to lower risks, but the arrangement caused some controversy after benchmarks indicated performance variances between the companies' processors.

The processor in the iPhone 7 and iPhone 7 Plus is likely called the A10. Both devices are expected to debut in September. Leaks of the phones' design suggest that it may have a flush rear camera and a lack of antenna bands on its back. Other rumors indicate that the 7 Plus may feature a dual-lens camera system and that it may be waterproof and not have a headphone jack.

Tags: A10, TSMC
Related Forum: iPhone

Top Rated Comments

132 months ago
This is the risk of using one manufacturer. If something goes wrong to effect supply, cutting Samsung out will not seem like such a smart move.
Score: 5 Votes (Like | Disagree)
macs4nw Avatar
132 months ago
Earthquakes have a thing for delaying iPhones.
I realize you're probably saying that in jest, but it's just that a lot of the manufacturing of the components that go into our tech goodies, takes place near the "Ring of Fire ('https://en.wikipedia.org/wiki/Ring_of_Fire')" where roughly 90% of the world's earthquakes occur, often also accompanied by tsunamis and massive flooding. Remember the massive flooding in Thailand ('http://www.nytimes.com/2011/11/07/business/global/07iht-floods07.html') which caused widespread HDD shortages in 2011-2012?

Those of us who don't live near there can count their blessings, and I for one will gladly suffer some occasional delays to my material indulgences as I watch untold human suffering on the news from the safety of my living room, when another disaster hits those unfortunate people.
Score: 3 Votes (Like | Disagree)
ArtOfWarfare Avatar
132 months ago
This 1% estimate was before. Now the estimate is bigger and they aren't saying by how big.
They said it was going to impact them by less than 1%. Later, they said it might be over 1%.

Might be over 1% suggests to me it's probably not a lot more than 1%.
Score: 2 Votes (Like | Disagree)
132 months ago
So Apple's first step towards getting rid of Samsung as an essential supplier backfires immediately, interesting.

They said it was going to impact them by less than 1%. Later, they said it might be over 1%.

Might be over 1% suggests to me it's probably not a lot more than 1%.
Or, it's just carefully worded to smooth over the more serious reality, like how all Apple Support articles regarding widespread hardware issues begin with "We've discovered that a very small number of units are experiencing issues with..."
Score: 1 Votes (Like | Disagree)
kdarling Avatar
132 months ago
It's never a good idea to put all your eggs in one basket with a sole supplier, especially as Apple is rapidly heading towards becoming a one product company heavily dependent on a few key suppliers.

Its about time they figured out a way to automated more of the manufacturing process and bring some jobs back to the US.
I haven't looked in a long time but aren't most chip foundries in the same geographic area anyway making them all susceptible to a major event such as this?
All these factors... multiple suppliers, geographic stability/diversity, and US factory... were taken care of when Apple was using Samsung, who had built an extra multi-billion dollar foundry in San Antonio Texas a half decade ago to supply Apple's ARM chips.

Those chips normally account for about 10% of an iPhone's bill of materials.

Moving completely to a Taiwan supplier, while closer to Foxconn China and probably cheaper, is a negative for both Samsung and Texas. And not very smart for Apple apparently, either. It smacks of a bean counter decision, with cost being the most important factor.
Score: 1 Votes (Like | Disagree)
132 months ago
Let me guess, Samsung created the earthquake so they could get in on part of the deal now?
Score: 1 Votes (Like | Disagree)

Popular Stories

iOS 26

iOS 26.4 Adds Two New Features to CarPlay

Tuesday March 24, 2026 1:55 pm PDT by
iOS 26.4 was released today, and it includes a couple of new features for CarPlay: an Ambient Music widget and support for voice-based chatbot apps. To update your iPhone 11 or newer to iOS 26.4, open the Settings app and tap on General → Software Update. CarPlay will automatically offer the new features so long as the iPhone connected to your vehicle is running iOS 26.4 or later....
Apple Business hero

Apple Unveils 'Apple Business' All-in-One Platform

Tuesday March 24, 2026 8:53 am PDT by
Apple today announced Apple Business, a new all-in-one platform that unifies device management, productivity tools, and customer outreach features. The service is designed to be a consolidated replacement for several of Apple's existing business-focused offerings, including Apple Business Essentials, Apple Business Manager, and Apple Business Connect. It provides organizations with a single...
AirPods Pro Firmware Feature

Apple Releases New Firmware for AirPods Pro 3, AirPods Pro 2 and AirPods 4

Tuesday March 24, 2026 12:31 pm PDT by
Apple today released new firmware for the AirPods Pro 2, AirPods Pro 3, and the AirPods 4. The firmware has a version number of 8B39, up from 8B34 on the AirPods Pro 3, 8B28 on the AirPods Pro 2, and 8B21 on the AirPods 4. There is no word on what's included in the firmware, but Apple has a support document with limited notes. Most updates are limited to bug fixes and performance...