In the midst of escalating global inflation and substantial price surges, the semiconductor manufacturing powerhouse TSMC has shocked the industry with an unexpected reduction in chip prices.
Renowned for its service to industry giants like Apple, Qualcomm, and Huawei, TSMC had originally slated a rise in quotes for advanced manufacturing processes by 2024. However, a twist of fate led them to slash the foundry price of 8-inch wafers by as much as 30% in the past week, due to plummeting demand.
This downward price adjustment could potentially prove advantageous for technology firms, particularly those within the automotive chip domain. TSMC’s reduced pricing could ultimately translate into more economical offerings for end-users. Yet, for TSMC itself, this situation could only mean bad things.
The company’s financial statements present a complex landscape. Although the initial quarter of the year displayed a moderate uptick in revenue, the subsequent quarter experienced a decline in both revenue and net profit. This decline signifies the least quarterly growth observed in nearly four years.
In spite of these hurdles, TSMC’s choice to reduce prices serves as a reminder that the market is constantly changing. While the immediate horizon might appear uncertain, this action by TSMC could be a calculated maneuver to secure its customer foundation and align with an evolving market landscape.
While this move may make cheaper smartphones even more affordable, the same cannot be said for premium devices. This is because Qualcomm is speculated to increase the price of its upcoming Snapdragon 8 Gen 3 chip to $200.
Via: Gizmochina
