60%
Plausible
TSMC's silicon prices are increasing across the board next year, and Apple's vast array of custom chips are no exception. The culprit: TSMC's soaring CapEx on its 2nm node process, and the contract chip manufacturer's overall tight capacity.
TSMC has reportedly informed Apple and other major clients of 8-10 percent price hikes for next year
The rumor aggregator blog on the Naver platform, known as Yeux1122's Blog, is now reporting that TSMC has purportedly informed its major clients, including Apple, of imminent price hikes for sub-5nm advanced chip fabrication processes. The price hikes are reportedly in the 8 to 10 percent range, and are slated to go into effect next year.
Apple's A16, A17, A18, A19, M3, M4, and M5 chips leverage TSMC's sub-5nm chip fabrication processes. As such, it appears that the Cupertino giant's entire array of custom silicon is now set to be affected.
Of course, China Times reported back in September that Apple's upcoming A20 chip, which will leverage TSMC's 2nm node and ship with the iPhone 18 lineup, will be one of the most expensive chips to ever go into the iPhones.
Specifically, the report claimed that TSMC expected its 2nm node process to be considerably more expensive than the 3nm one, given the new node's lower yields and TSMC's soaring CapEx. The report claimed that all chips manufactured on TSMC's 2nm node would bear an average unit price of $280. For reference, DigiTimes reported in 2024 that the 3nm A18 chip cost $45 per unit, with Apple's total Bill of Materials (BoM) for the $799 iPhone 16 computing at around $416.
Of course, the rumored 8-10 percent price increase for Apple's advanced chips does not yet equate to the $280 per unit price claimed by China Times in September for all chips manufactured on TSMC's 2nm node. Remember, Apple's A20 chip in 2026 is widely expected to use this cutting-edge node.
Nonetheless, the situation remains precarious and might deteriorate further, courtesy of the AI-driven diversion of global DRAM capacity towards HBM, leaving a historically tight capacity for mobile-centric LPDDR5x.
The tight global capacity for memory modules is already affecting smartphone pricing. A recent report from Goldman Sachs noted that for the Redmi Note 14, which retails for $299, CMF indicates that the price of the 8GB+256GB uMCP (LPDDR4X + UFS 2.2) configuration has risen to $49, making up about 16 percent of the smartphone's retail price. Just a year back, the configuration constituted only 10 percent of the retail price.
Meanwhile, a recent Samsung-centric report disclosed that the cost of mobile SoCs has increased by 12 percent year-over-year, while camera modules have become pricier by around 8 percent, and the LPDDR5 memory costs have soared over 16 percent relative to last year's price levels.
For added reference, here are the per unit prices of Apple's previous custom silicon chips:
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