TSMC has released an official statement stating since May 15 it stopped accepting new orders from Huawei, but the worst news is that it will stop supplying silicon to Huawei as of September 14 .
This is due to the grace period the United States has given the Taiwanese foundry to process and ship existing orders. Once that day arrives, TSMC is prohibited from supplying Huawei with more processors, unless the Chinese company receives a license from the United States regulators, come on, something impossible.
It has been wildly speculated that Huawei has preempted the United States ban and has placed large orders with the TSMC in order to have a sufficient supply of silicon for the remainder of the year. However, once these stocks are depleted and if the political situation is not resolved by then, it would mean that the company would be in serious trouble.
While Huawei accounted for 23 percent of TSMC’s revenue in 2019, the foundry already reassured its investors, stating that the ban will have no negative effect on the company’s revenue, as other customers will be splitting the number of wafers.
In addition to having placed large orders with TSMC, Huawei also began requesting the Chinese foundry SMIC to manufacture silicon @ 14nm. According to all reports, SMIC is expected to start its 7nm production later this year, with 5nm expected to arrive in 2024.