Apple supplier TSMC says Taiwan quake will affect chip production

TSMC Fab 14

TSMC Fab 14

On February 6, a magnitude-6.4 earthquake rocked Taiwan, killing five people and injuring over 140 more. In the immediate aftermath of the tremor, Apple chip supplier TSMC stated that damage to its fabrication facilities was minimal and that chip shipments would fall less than one percent -- in fact, the company noted that it would be able to make up losses. It's now being reported that fewer chips will ship to clients during the March quarter due to damage that was more severe than originally estimated.

Production will fall by more than one percent, although TSMC didn't say how much. Machinery in two of the TSMC fabrication buildings -- Fab 6 and Fab 14B -- has already been restored to full functionality, but the damage to another building -- Fab 14 -- was more significant than the company originally thought.

TSMC currently makes A9 processors for devices like the iPhone 6s, with Apple rival Samsung providing most A9 production. It's rumored that TSMC will be the sole source of the next-generation "A10" processor that's anticipated to be the heart of the iPhone 7, so it's important that TSMC get production back up to speed as soon as possible.