TSMC to Begin 2nm Chip Trials, Apple Secures Capacity

TSMC is poised to start trial production of its 2nm (N2) process chips next week at its Baoshan factory in Hsinchu Science Park, northern Taiwan. These cutting-edge chips are expected to be used first in Apple's iPhone 17 Pro and other Apple products. According to insiders, TSMC presented its 2nm process to Apple in December 2023, with trial production slated for October 2024. This advancement indicates that TSMC's 2nm technology is progressing faster than anticipated, with mass production expected to begin in the fourth quarter of 2024.

TSMC reports that the 2nm process node will deliver a 10% to 15% improvement in energy efficiency and up to a 30% reduction in power consumption compared to the 3nm process. Upon achieving satisfactory trial production yields, the process will transition to mass production. TSMC will introduce the GAA (Gate-All-Around) nanosheet transistor structure with the 2nm process, enhancing performance. Additionally, the company plans to implement backside power delivery (BSPR) technology, increasing chip density and speed, with mass production targeted for 2026.

The strong demand for AI chips has led to TSMC's 3nm production capacity being fully booked. Reports indicate that "capacity is fully reserved through the end of the year," and there are rumors of a potential price increase for 3nm foundry services.

Apple has reportedly secured an exclusive agreement with TSMC for the entire initial production capacity of 2nm chips, similar to its strategy with the 3nm process. The A17 Pro is the first mass-produced chip using TSMC's 3nm process, featuring around 19 billion transistors.

To meet the growing demand for AI chips, TSMC is also accelerating the construction of its second 2nm factory in Kaohsiung.