Big iPhone Parts Maker Hit By Virus Critical Delay

Yolanda Curtis
August 6, 2018

TSMC is the exclusive provider of the A12 chips that will power all of this year's iPhones and new iPad Pros.

(TSMC), the sole manufacturer of the iPhone's main processor, was shut down following a virus attack.

No confidential information was compromised, the company said.

What isn't known is exactly what TSMC was targeted by or which factories were hit with the company having manufacturing facilities in Taiwan, mainland China and the U.S.

Still, TSMC's statement that the virus will affect shipments comes at a sensitive time for Apple, which is TSMC's largest customer and accounts for more than 21 percent of its revenue, according to data compiled by Bloomberg.

KGI Securities said in a report on Monday that while some of TSMC's 12-inch wafer shipments will be delayed, the impact to the upcoming iPhone launch is limited because "the upstream supply chain usually prepares for these incidents and manufactures surplus chipsets during the initial ramp-up stage".

Digitimes is reporting the announcement by TSMC that the virus infection is estimated to impact its third quarter revenue to the tune of 3%.

The company says that the virus was introduced when a supplier installed infected software - which was provided by a vendor - without a virus scan.

It added that it has "taken actions to close this security gap and further strengthen security measures". An Apple spokesperson didn't immediately respond to a request for comment on Sunday.

Shares in TSMC in Taipei were down 1% in late morning trading on Monday. Apple is, without a doubt, TSMC's most prized contract, as TSMC fought off Samsung to win exclusivity for iPhone chips. I can't imagine TSMC's partners are particularly happy but it does seem that things are to get back on track in the following quarter.

It said the attack had featured a "mutation" of the Wannacry ransomware.

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