Nvidia overtakes Apple as largest customer at TSMC where top 10 accounts yield 76%

Business Model & Economic Role

A single 300mm silicon wafer processed on TSMC's 3-nanometer line leaves the fab priced near US$20,000, carrying a few hundred finished processors that the customer designed but could not have built itself. That object explains the company. TSMC does not invent and sell its own chips. It sells qualified, high-yield capacity on the most advanced manufacturing lines in operation, and it rents that capacity to the firms whose logos end up on the silicon: Apple, Nvidia, AMD, Broadcom, Qualcomm, and MediaTek.

The arrangement has a name TSMC coined. It created the dedicated foundry model when it was founded in 1987: a manufacturer that designs no products of its own and therefore competes with none of its customers. That self-imposed limit is the load-bearing wall of the franchise. A fabless designer hands TSMC its most valuable asset, the circuit layout, and will only do so because TSMC will never ship a rival GPU or phone chip against it.