After the powerful 7.5-magnitude earthquake near Taiwan, worries have emerged regarding possible interruptions to the worldwide chip supply chain. Taiwan is a major hub for semiconductor manufacturing, and so speculations have risen about the condition of the semiconductor factories in the aftermath of the earthquake. However, NVIDIA, one of the largest companies in the AI sector, has assured stakeholders that its chip supply remains unharmed.
US-based NVIDIA, which heavily relies on Taiwan Semiconductor Manufacturing Co. (TSMC) for its chip production, has confirmed that the earthquake has not impacted its supply chain in the country. TSMC, responsible for fabricating chips for numerous tech giants like Apple, AMD, Qualcomm, and NVIDIA, has reported no damage to critical chip-making equipment, including the Extreme Ultraviolet Lithography machines.
Although some tools were damaged at certain TSMC facilities, the core machinery remains intact. TSMC temporarily evacuated some production facilities as a precautionary measure, to ensure the safety of its employees. However, within just 10 hours after the earthquake, operations have resumed at 70-80% capacity.
TSMC said that it could resume its operations quickly thanks to its preparedness for such events. For instance, TSMC has used building dampers and conducted regular earthquake drills to mitigate the impact of any seismic activity on semiconductor production.
Semiconductor manufacturing requires precise and uninterrupted operations in controlled environments. Even small issues or interruptions can cause major losses, such as discarding entire silicon wafers. However, TSMC’s readiness for earthquakes, and protective measures, helped in safeguarding its production line.
The last notable disruption experienced by TSMC was in 2016 when manufacturing facilities in Tainan suffered damage, resulting in the loss of wafers. Since then, TSMC has continually refined its strategies to ensure minimal disruptions during natural disasters.
NVIDIA cannot survive without TSMC’s Chip Supply
TSMC is NVIDIA’s primary chip manufacturer and supplier of the latest semiconductor technology. NVIDIA relies on TSMC’s cutting-edge manufacturing processes to produce high-performance GPUs such as the latest Blackwell architecture models.
The collaboration between NVIDIA and TSMC ensures efficient chip designs and supply. However, TSMC’s contributions span beyond GPUs and include other essential semiconductor technologies for NVIDIA’s products. This partnership guarantees a reliable chip supply, crucial for meeting market demands and maintaining NVIDIA’s competitive advantage.
TSMC is the biggest chip maker globally, with more than half of the global market share. If anything happens to TSMC, it would not only affect NVIDIA but also other leading AI and technology firms as it would affect their chip production and potentially disrupt their supply chains. Any risk to TSMC is concerning for NVIDIA and the global tech sector, as it could significantly affect technological progress worldwide.
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(via)
