Top Apple chip supplier has a warning for the smartphone industry

Mark Louis, president of Taiwan Semiconductor Manufacturing Company (TSMC), said earlier this week that demand for smartphones, PCs and TVs is slowing in China amid geopolitical tensions and COVID-related lockdowns. Nikkei Asia quoted the company chief as saying that China, the world’s largest electronics consumer market, is also showing signs of slowing down in demand. TSMC is Apple’s leading supplier and the world’s largest contract chip manufacturer. Liu also warned that the cost of components and materials is rising rapidly, increasing production costs for tech and chip companies.

The latest report comes a day after publication that revealed that Apple has reduced orders for its recently released iPhone SE by three million units. Nikkei said TSMC is unlikely to change its growth target and capital expenditure this year. Liu noted, “Despite the slowdown in some sectors, we still see strong demand in automotive applications and high-performance computing as well as Internet of Things-related devices… Can’t meet customer demand. We will reorganize and prioritize orders for areas that still see good demand.”