Apple is saving a huge amount of money thanks to a sweetheart deal it has with TSMC
The iPhone 15 Pro and iPhone 15 Pro Max will be the only phones available this year that are powered by a chipset made using the 3nm process node. And that should be a big deal because the lower the process node number, the smaller the chip's feature set. A smaller feature set means that a chip can have more transistors and more transistors make a chip more powerful and energy efficient.
Usually, the risk in producing chips is placed on the chip designer, which, in the case of the A-series SoCs, is Apple. If a die is defective, the chip designer still has to pay for it. That is why foundries with low yields usually don't hold on to their current client list for too long. TSMC's early 3nm production has had a 70% yield rate according to The Information, which isn't bad, especially for the first year of major production of a new process node.
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Not that Apple has to be worried about paying TSMC for bad dies. Apple's orders with TSMC are so huge that the foundry can afford to take the risk on low yields itself. That's right, Apple is not financially responsible for chips that don't pass through QC as TSMC will eat the cost of bad dies. This sweetheart deal can save Apple a decent amount of money, possibly an amount in the billions.
Apple reserved all of TSMC's 3nm production this year, the first year that it has been available. This exclusivity will last for about a year before enough capacity frees up to allow other TSMC customers to get their 3nm chip designs manufactured. Apple is believed to have been responsible for 23% of TSMC's profits last year of $72 billion so Apple often gets first crack at a new process node before other firms do.
That won't be an issue again until 2025-2026 which is when TSMC is expected to start mass-production using its 2nm process node. It will be interesting to see whether both Apple and TSMC are so pleased with how things worked out this year that they both agree to another sweetheart deal in two to three years.
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