00:00 Speaker A
Nvidia is shaping up to overtake Apple as Taiwan Semiconductor’s top customer in 2026, a shift that could reshape the chip sector for more than we’re bringing in now.
00:10 Speaker A
Ben Bajarin, CEO and principal analyst at Creative Strategies. Ben, my friend, always great to see you. So let’s dig in, Ben.
00:15 Speaker A
You have this new post on your Substack, Substack where you make this interesting point, Ben. Say, you see Nvidia overtaking Apple as TSMC’s biggest customer. Just walk us through that, Ben, and what you say there. What is the trend?
00:29 Ben Bajarin
Yeah, so I think that was inevitable for a while. I mean anyone who looked at the revenue contribution from the customer, probably for the last year just saw how much Nvidia got and why they were on their way to basically overtake Apple. Um they were pretty close and I think, you know, 2026 is the year where uh they become TSMC’s largest customer by revenue, right?
00:46 Ben Bajarin
And uu that and I think that shift signals a couple of different things. If you just look at TSM’s TSMC earnings, you see the shift to HPC, so high-performance computing is the vast majority of their revenue, and that’s only going to continue to grow.
01:00 Ben Bajarin
Um and that’s just a big change from the mobile days, isn’t it? where Apple was really the predominant customer customer chewing up wafers for, you know, iPhones and uh iPads and Macs and something for this space where we’re with this AI accelerator segment, they start to take so much more capacity, really driving some of the vast limitations that we see in holistic semiconductors across the board.
01:25 Ben Bajarin
So it’s really just a change in structure, a sign of the times. Um, you know, Apple is still relevant to TSMC, uh quite significant in terms of wafer consumption, but the wafers and the work and the advances and the capacity and the CAPEX that TSMC needs to do for uh Nvidia and others is very different from what they had to do the last 10 years for Apple.
01:47 Speaker A
So let me ask you Ben, if I was an Apple investor and I’m hearing this and okay, TSMC’s biggest new customer, Nvidia is not Apple. How should I interpret this, Ben? Should I make that sign, does this suggest that Apple is somehow uh less of a priority for TT-TSMC?
02:00 Ben Bajarin
No, I don’t think so. I think they are again, strategic priorities in different ways, right? So Apple makes um, you know, monolithic chips, right? So it’s one chip per device, right? As part of the overall wafers. And so that process is not going. When you look at what Nvidia does, that’s a multi-step process. GPUs are much larger per wafer and since they use advanced packaging, there are more steps involved to get from GPU to GPU package, right? This goes into Nvidia’s product.
02:18 Ben Bajarin
So, I think both are still significant. Um also does not change the shape of Apple’s growth direction. There are still requests across the board for Apple products. We don’t see anything changing. Um it’s just I think it just shows the diversity that TSMC is going into right now.
02:35 Ben Bajarin
And, you know, I think a bigger question is does this open up, you know, does Apple start looking at other sources again? Um you know, again, Intel came up, right, as a foundry, you know, a potential option for some Apple products, obviously not kind of the main line ones. But we are against manufacturing that is limited in supply in the environment and in the foundry and that only creates a dynamic of challenges for everyone, right?
03:00 Ben Bajarin
That will be true of Nvidia, it will be true of Apple, and they need to navigate that supply chain. So it’s really just again a structural sign of the times we’re in relative to AI, but I don’t think it changes the priority um that Apple still has in TSMC.