For the past three years, production of TSMC’s leading-edge process nodes  - 20nm, 16nm and 16FF+ -  has always ramped up following orders of a new iPhone SoC – the Apple A8, A9 and A10. In 2017, it appears this will not be the case as the researchers claim that TSMC’s 10nm yields are currently still below 50 percent.

Apple A10 undergoing small pilot runs

In response, TSMC is now scheduled to be doing small pilot runs of Apple’s A11 SoC right now in Q4 2016 and will instead begin ramping up production in late April. The report suggests that the foundry’s 10nm process should be able to exceed 20,000 wafers per month in Q1 2017 following the small pilot runs.

Back in May, we wrote that TSMC had finished taping out the company’s A11 chips, with certification coming in Q1 2017. and that they would likely start generating revenues for TSMC in the third quarter of 2017.

Apple A10X production for next iPad Pro will also ramp slowly

Meanwhile, TSMC’s 10nm volumes for Apple’s A10X chip slated for the next iPad Pro models are reported to be roughly half of MediaTek’s 10nm Helio X30 and X35 SoC volumes, with just 7,500 wafers per month expected from January to March.

As Ashraf Eassa from The Motley Fool notes in his own report, however, Apple’s A10X and MediaTek’s X30 and X35 are still relatively low-volume products compared to Apple’s A11 for the next-gen iPhone. Even if TSMC’s 10nm yields are below 50 percent, it would suggest that shipment volumes should be relatively modest up until the end of April, without TSMC’s overall gross profit margins being diluted too much.

Given the estimated $120 million design cost for developing 10nm chips, according to Gartner at least, TSMC really does not want to have any issues with low yields once production begins to ramp up in just a few months from now.