Apple chip maker TSMC decreases shipments after production hit by Taiwan earthquake

Taiwan earthquake

Apple chip maker TSMC, which is responsible for producing the A9 series processors for iPhone 6s and 6s Plus alongside Samsung, has been forced to decrease shipments during the first quarter of 2016 due to a large earthquake that hit southern Taiwan earlier this month.

TSMC originally warned that it would decrease shipments by less than 1 percent on February 6. However, the company now says that the damage caused to its Fab 14 facility is worse than originally assessed, so shipments will decrease by more than 1 percent overall.

TSMC is yet to provide a more specific indication of the impact the earthquake will have on production long-term. The 6.4 magnitude earthquake, which hit Taiwan on February 6, killed 116 people and injured many others.

“TSMC originally estimated that more than 95% of foundry machines could be restored to normal conditions in 2-3 days following the earthquake,” reports DigiTimes. “Machines at Fab 6 and Fab 14B have already been fully restored, the company said.”

TSMC is confident it will still reach revenue targets of NT$198-201 billion (US$5.9-6.0 billion) for the first quarter of 2016, despite the shipment decrease.

It’s unlikely that the issue will have an impact on iPhone supply, either, though TSMC has been chosen to produce all of Apple’s A10 series processors for the upcoming iPhone 7 and iPhone 7 Plus, according to a recent report.

Meanwhile, Innolux, a panel maker that works with Apple assembly partner Foxconn, has confirmed the earthquake caused damage to its 5G and 6G factories, but did not affect its 3.5G and 4G factories. The company has shifted production to northern Taiwan to minimize the impact.