From a note to Chinese investors posted Wednesday by the bank’s Asia technology team:
Today, Commercial Times reported that Apple may push out the production of its 5nm based A14 chips for the upcoming iPhones by 1-2 quarters. Based on our research, this doesn’t appear to be true. We believe that TSMC has already started wafer starts for 5nm last month (for initial preparatory work) and A14 chip design was already signed-off by Apple last week. We expect TSMC to start meaningful wafer-inputs for the A14 chip from 2Q20 and see revenue contribution from 3Q20. While the iPhone schedule may indeed be delayed by 1-2 months due to multiple factors (5G network readiness, final product engineering and verification delays etc.), we do not think that processor is likely to be a bottleneck.
We do hold a more cautious view on Apple supply chain overall (link), given ongoing demand destruction in developed markets and expect that the tightness in 7nm and 5nm is likely to dissipate by 2Q20. We also expect a semiconductor inventory correction in mid 2Q or early 3Q20 given ongoing demand destruction and potential double orders at foundry level in 1Q20 due to perceived tightness in overall capacity.
My take: Good to know.