(Source: Financial News)

Both TSMC and Apple are known for top-tier execution. Given how closely coordinated their supply chains are, such a dramatic development would be unusual.

There are reports that TSMC (TSM.US) cannot complete the final packaging of the A20 Pro (2nm/N2) processors worth about $1 billion that it produces for Apple (AAPL.US). The chips are therefore piling up at the factory, waiting for storage chips to arrive.

Chain analyst Guo Ming-chi said that Apple (AAPL.O) has indeed reduced its hardware shipment plans this year due to a shortage of memory. However, Apple will at least plan TSMC’s processor production three months in advance based on the expected amount of available memory, rather than having TSMC produce large volumes of WIP early and then wait for memory to be available for packaging. As far as I understand, there hasn’t been a dramatic scenario where TSMC first accumulated $1 billion worth of WIP, then had to wait for memory to arrive before it could be packaged. Both TSMC and Apple are known for top-tier execution. Given how tightly coordinated their supply chains are, such a dramatic development would be unusual.