Huawei Kirin 9000 squeezes TSMC’s 5nm production capacity

Kirin 820

Chinese manufacturing giant, Huawei, will unveil the Huawei Kirin 9000 chip at its IFA Berlin event on September 3. There are also speculations that the company will unveil the Huawei Mate 40 series at the event. However, there is no official confirmation of the release of its latest flagship. Due to the US ban, this chip may become Huawei’s last Kirin mobile phone chip. In addition, the Huawei Mate 40 series may also be Huawei’s last flagship smartphone for now. However, there is a huge pressure on the foundry to deliver the Huawei Kirin 9000. 

Huawei Kirin 9000

As we all know, TSMC is in charge of the Kirin 9000 and this is the world’s first 5nm mobile phone chip. Huawei Kirin’s 5nm chip hit the market before the likes of Qualcomm and Apple. In response to the U.S. ban, Huawei has previously increased TSMC’s 5nm production volume. The Chinese manufacturer plans to reserve the Kirin 9000 inventory. This plan squeezes TSMC’s 5nm production capacity. TSMC will ship all relevant chips to Huawei before September 14. After that, the company can not have any business dealings with Huawei.

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TSMC Chairman, Liu Deyin, said at the July Legal Conference that the company has not accepted any new orders from Huawei since May 15. In addition, it will no longer ship to Huawei after September 14.

Kirin 9000 will be Huawei’s last flagship chip for now

According to Yu Chengdong, due to US sanctions, Huawei’s global leading Kirin series chips cannot be manufactured after September 15. This is the first time that Huawei will be officially confirming the termination of its Kirin chips. 

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Huawei is TSMC’s second-largest customer and contributed approximately 15% to 18% of TSMC’s revenue in 2019. The supply chain pointed out that in the face of the US technology restraint, Huawei had prepared as early as last year to book TSMC’s 5nm production capacity in advance. In fact, the Huawei “Kirin 9000” was listed as a priority production product. Before production stopped in mid-September, sufficient inventory had been prepared for Mate 40 series. Due to the output of Huawei, Apple and Qualcomm chips, TSMC is in full load in the second half of the year.

The U.S. Department of Commerce has a series of policies which attemts to cripple Huawei’s smartphone business. The law may prevent MediaTek from selling chips to Huawei. It also stops TSMC from producing Huawei chips. However, the question is “what does the U.S. stand to gain of Huawei’s smartphone business goes under”? 

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