NVIDIA Becomes TSMC’s 2nd Largest Customer, Coming Right Behind Apple

NVIDIA has become a valuable client of TSMC, as the firm takes the 2nd spot regarding the Taiwan giant's revenue sources, coming behind Apple.

The FY 2023 has been a timeline of progression for Team Green, with the advent of the AI hype bringing massive demand for the firm's AI accelerators and other product offerings. The boost in the supply chain led to NVIDIA increasing its collaboration with TSMC on both economic and technological grounds, which is why the firm has become a primary customer for the semiconductor giant.

Nvidia became TSMC’s 2nd biggest customer last year, as the AI chip maker paid NT$241.15 billion (US$7.73 billion) for TSMC’s chip manufacturing services and accounted for 11% of net revenue.1/3 $NVDA $AAPL $TSM #semiconductors

— Dan Nystedt (@dnystedt) March 1, 2024

According to an audited report of TSMC's FY 2023 earnings, NVIDIA has become TSMC's 2nd biggest customer, placing orders reportedly valued up to US $7.73 billion, an 11% share in the firm's total revenue. The numbers aren't surprising at all, considering the volume of AI GPUs sold by NVIDIA during the previous years, which had also created a supply bottleneck for TSMC. However, despite the rapid growth, Apple remained TSMC's primary customer, accounting for US $17.52 billion and 25% of the firm's total revenue in 2023.

Other firms such as MediaTek, AMD, Qualcomm, Broadcom, Sony, and Marvell were responsible for the rest of TSMC's financial growth this year; however, NVIDIA and Apple managed to gain a double-digit share. Both companies have established concrete relations with the Taiwan giant, eagerly waiting for the firm's next-gen processes for immediate adoption, and by the looks of it, TSMC's revenue will only go higher from here.

NVIDIA has indeed made huge strides in establishing its presence in the global supply chain, as the firm has made relations with Samsung Foundry and IFS in an attempt to diversify its sources. Despite that, it seems like Team Green wants to stick with TSMC in the long run, indicating that the firm could play a massive role in the growth of the Taiwan giant in the future, potentially surpassing Apple if things continue at the current pace.

News Source: Dan Nystedt