Huawei contributes more than 30 billion yuan in revenue to TSMC every year, and it is still growing rapidly.
Liu Deyin said that the loss of Huawei's orders will not affect TSMC's revenue, and the construction of chip production lines with non-American technologies is not the direction currently under consideration.
Liu Deyin said this because he believes that the mainland cannot manufacture advanced chips, Huawei will inevitably purchase Qualcomm and other American chips, and orders will eventually flow to TSMC.
However, in just three years, the Kirin 9000S chip has achieved domestic manufacturing, and Bloomberg and others have confirmed that it is close to or has reached the 7nm level, but the actual performance is comparable to the 5nm Qualcomm Snapdragon 888 chip.
Huawei's use of the Kirin 9000s naming method may also imply that it is comparable to the Kirin 9000 chip.
The key is that Huawei Mate60Pro and other models equipped with Kirin 9000S chips have sold out, and sales have far exceeded expectations, and they are still in short supply, driving Huawei's revenue to grow rapidly, achieving revenue of about 250 billion yuan in the fourth quarter of 2023.
Now, five months after the Huawei Mate60Pro went on sale, TSMC is starting to get anxious.
First of all, TSMC has twice delayed the mass production of chips in the United States, 4nm and 3nm chips have been delayed, and mass production may not be until 2028 at the latest, in addition to factors such as high cost, mainly because of the lack of advanced technology chip orders.
After the launch of Huawei Mate60Pro, Huawei completely abandoned Qualcomm's high-end chips, and all mid-to-high-end models use Kirin chips.
Qualcomm is **, the number of chips shipped to China in 2024 is expected to decrease by more than 40 million to 60 million.
TSMC's 7nm and other advanced production capacity itself is overcapacity, Huawei Kirin 9000s and other chips have been domestically made, imported chips continue to decrease, and TSMC's production capacity will naturally be further overcapacity.
Second, it has slashed capital expenditures and cut some lithography machine orders, and ASML has said that there is overcapacity in advanced processes, and new lithography machine orders fell by 40% year-on-year.
TSMC used to be ASML's largest customer, and more than half of its EUV lithography machines were shipped to TSMC, but on the NA EUV lithography machine, TSMC lost enthusiasm.
The first NA EUV lithography machine was shipped to Intel, and six of the 10 units planned for 2024 are Intel's.
The key is that TSMC will reduce prices for processes such as 7nm to attract more orders, but increase prices for processes such as 5nm to gain more revenue and profits.
Finally, the development direction of TSMC has also changed, and Liu Deyin's announcement of retirement is the best proof of this, and he hopes that Wei Zhejia will become the chairman.
Because Wei Zhejia attaches more importance to the domestic market, saying that new energy vehicles have brought huge opportunities to mature process chips, which is greater than smart phones, China is the world's largest producer and seller of new energy vehicles, and personally led a team to visit important domestic customers.
Wei Zhejia also announced that he would stay in Taiwan and actively apply for permanent immunity, adding that it was basically no problem to obtain it.
The key is that Zhang Zhongmou also suddenly spoke out, saying that he supported launching a chip war against China, which undoubtedly recognized that Huawei and other domestic industrial chains had made breakthroughs, which also brought a threat to TSMC.
After all, Zhang Zhongmou's previous attitude was that there was at least a five-year gap between SMIC and TSMC and other domestic manufacturers, but now, 75% of SMIC's orders come from domestic manufacturers.
What's more, ASML has delivered all the orders for lithography machines prepaid by domestic manufacturers, including models such as 2000i, which can reduce the chip manufacturing process to 5nm.
SMIC has already completed the 7nm R&D task, and 5nm has also started R&D, as well as self-developed N+1 and other processes.