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So let's say TMSC reciprocated Apple's consistency as a customer by giving them preferential treatment for capacity. It's good business after all. However, eve
by anoojb 8mo ago
So let's say TMSC reciprocated Apple's consistency as a customer by giving them preferential treatment for capacity. It's good business after all.
However, everyone knows that good faith reciprocity at that scale is not rewarded. Apple is ruthless. There are probably thousands of untold stories of how hard Apple has hammered it's suppliers over the years.
While Apple has good consumer brand loyalty, they arguably treat their suppliers relatively poorly compared to the Gold standard like Costco.
- bethekidyouwant 8mo agoAgreed TSMC can do whatever they want. in 2027 no other fabs will match what tsmc has today, anything that requires the latest process node is going to get more expensive, so your apple silicone and your AMD chips
- high_na_euv 8mo agoAs of today Intel is very around leading node
- girvo 8mo agoI'll believe it when I see it (at scale). I hope 18A is good enough as competition is good, and a weak Intel is bad for us all.
- high_na_euv 8mo agoPTL is already released, on shelves in like 2 weeks.
- girvo 8mo agoYes and it’s looking promising, but one mobile processor does not prove a nodes success at scale. It definitely implies it though, I’m hopeful that competition is back.
- MangoCoffee 8mo agoyield is more important than leading node.
- high_na_euv 8mo agoBoth are important
- thiago_fm 8mo agoYes and no. Sunk cost. They are always balls deep, if it takes them 2 years to get a TSMC yield, with as much as demand it exists for high-end fabs, they could already easily get financing to already build even more capacity. Now they have literally the US government as an investor. One would be naive to believe that they wouldn't get at least a few hundred billion dollars to scale it up given the so many risks involved in most of US tech sector being dependent on Taiwan.
- bethekidyouwant 8mo agoDamn, you would think it would be priced in…
- high_na_euv 8mo agoIt is slowly being priced
- Forgeties79 8mo ago> they arguably treat their suppliers relatively poorly compared to the Gold standard like Costco. I’m not saying you’re wrong but you’re previous paragraph sounding like you were wondering if it was the case vs. here you’re saying it’s known. Is this all true? Do they have a reputation for hammering their suppliers?
- xp84 8mo agoApple is so notoriously ravenous for profit margin that they can’t not be that way.
- Forgeties79 8mo agoIt felt like a more confident statement and I was legitimately asking. I have little love for Apple. Ditched my Mac Studio earlier this year for a Linux only build after 20 years of being on Macs. I say this because I think folks think I am trying to sealion/“just ask questions:tm:” or some nonsense, when I am legitimately asking if this is a documented practice and what the extent is. I am not finding it easy to find info on this.
- xp84 8mo agoTotally fair question. Being fully transparent, I'm exclusively extrapolating based solely on their publicly-known behavior (e.g. the way they deal with their developers on the App Store), but am not a primary source on their hardware component vendor relationships myself.
- bigyabai 8mo agoApple dealt exclusively with Chinese labor prices until they were directly threatened by the POTUS. You tell me.
- yurishimo 8mo agoI got a bridge to sell you if you think that Apple is going to bring any of their manufacturing to the US...
- boringg 8mo agoCounter argument is that is NVIDIA friendly to their supply chain? I have to think that maybe they are with their massive margins because they can be - their end buyer is currently willing to absorb costs at no expense. But I don't know, and that will change as their business changes. Your underlying statement implies that whoever is replacing apple is a better buyer which I don't think is necessarily true.
- marcosdumay 8mo agoIf your customers are known to be antagonistic to business partners, the correct answer is to diversify them as much as you can, even at reasonable costs from anything else. That means deprioritizing your largest customer.
- boringg 8mo agoFair I feel like that also speaks to nation+states trade policy. Also theres the devil you know and the devil you dont know.
- simonh 8mo agoYep, you can be close allies with a nation and have many shared interests, and even a trade deficit with them as we in Britain did, and then they stab you in the back with tariffs.
- tonyedgecombe 8mo agoAt these scales everyone is antagonistic, it comes with the territory.
- marcosdumay 8mo agoThat's what MBA schools teach you. That's also a lie, it's only antagonistic when one of the sides is controlled by a psychopathic asshole, and it being antagonistic is a serious drag for the gains of both sides.
- Aurornis 8mo agoAt this scale and volume, it's not really about good faith. Changing fabs is non-trivial. If they pushed Apple to a point where they had to find an alternative (which is another story) and Apple did switch, they would have to work extra hard to get them back in the future. Apple wouldn't want to invest twice in changing back and forth. On the other hand, TSMC knows that changing fabs is not really an option and Apple doesn't want to do it anyway, so they have leverage to squeeze. At this level, everyone knows it's just business and it comes down to optimizing long-term risk/reward for each party.
- CodeWriter23 8mo agoApple is the company that just over 10 years ago made a strategic move to remove Intel from their supply chain by purchasing a semiconductor firm and licensing ARM. Managing 'painful' transitions is a core competency of theirs.
- wtallis 8mo agoWhich acquisition are you referring to? Apple bought PA Semi in 2008 and Intrinsity in 2010.
- CodeWriter23 8mo agoPA, Intrinsity wasn't front of mind for me. My point is, Apple has proven they can buy their way into vertical integration, let's look at the history. 68K -> PowerPC, practically seamless Mac OS 9 -> BSD / OS X with excellent backward compatibility PowerPC -> x86 x86 -> ARM Each major transition, biting off orders of magnitude more complexity of integration. Looking at this continuum, the next logical vertical integration step for Apple is fabrication. The only question in my mind, does Tim have the guts to take that risk.
- Zafira 8mo agoI think you’re correct that they’re good at just ripping the band-aid off, but the details seem off. AFAIK, Apple has always had a license with ARM and a very unique one since they were one of the initial investors when it was spun out from Acorn. In fact, my understanding is that Apple is the one that insisted they call themselves Advanced RISC Machines Ltd. because they did not want Acorn (a competitor) in the name of a company they were investing in.
- dheera 8mo agoNo public company will be loyal or nice to their suppliers. That is just not in the playbook for public companies. They have "fiduciary duty", not human duty. Private companies can be nice to their suppliers. Owners can choose to stay loyal to suppliers they went to high school with, even if it isn't the most cost-efficient.
- deleted 8mo ago[deleted]
- hinkley 8mo agoApple loaned TSMC money in order to build manufacturing capacity back around the M1 era. They’ve done that for a number of suppliers and the “interest payments” were priority access to capacity. Everyone was complaining about how Apple got ARM chips while others had to wait in line. That said, they did that for a sapphire glass supplier for the Apple Watch and when their machines had QC problems they dropped them like a rock and went back to Corning. But is that really any different from any other supplier? And who tf do you think they’re going to drop TSMC for right now? They are the cock of the walk.
- bigyabai 8mo ago> And who tf do you think they’re going to drop TSMC for right now? Don't look now: https://www.macrumors.com/2025/11/28/intel-rumored-to-supply-new-mac-chip/ https://www.macrumors.com/2025/11/28/intel-rumored-to-supply...
- MangoCoffee 8mo agoIf Apple cares about their chip IPs, it will be very hard to trust Intel given Intel's past behavior with others like AMD.
- bigyabai 8mo agoIf Apple cares about their Softbank investment, the best possible outcome is that Intel copies their IP wholesale. Arm's white whale is Intel buying an architectural license, which they have zero incentive to do unless someone gives them an off-the-shelf core design that doesn't suck. The modern Cortex and Infiniverse designs are so pathetic that RISC-V might mature by the time ARM is the industry standard. And the smaller ARM IP hasn't been profitable since China mass-produced the clones. Courting Intel into buying an architectural license with a free IP bonus is a legitimately smart move for ARM's longevity, from Apple's POV.
- DeathArrow 8mo agoAccording to benchmarks latest ARM Cortex designs and Qualcomm Snapdragon designs are as performant as Apple's.
- leoc 8mo agoEven if Apple isn't very good at reciprocating faithful service from its suppliers, there's also the matter of how it treats suppliers who cause it problems instead.
- boplicity 8mo agoSuppliers really hate working with Costco. They're slow to pay, allow for only small margins, and often need too high of a percentage of a businesses revenue, all of which is not friendly towards suppliers.
- gamblor956 8mo agoNot true at all. Costco uses the industry-standard Net 60 for supplier payment. Companies have to be fairly large to be Costco suppliers. What suppliers lose in margin they more than make up for in scale. It's better to sell 10 million at 5% margin than 1 million at 10% margin. And they don't require a % of supplier's business revenue as that would be illegal in the U.S. Most of the products found at Costco are generally found at other retailers, just in smaller packages or as different SKUs.
- sellmesoap 8mo agoAbout 17 years ago I worked at a company that was clamoring to get products into Costco, when we did I was shocked at the fees they charged us for returns. If they're the gold standard for supplier relations it's a wonder anyone bothers being a supplier.
- deleted 8mo ago[deleted]
- TurdF3rguson 8mo agoYou were shocked that they didn't absorb the cost of your shipping mistakes?
- HarHarVeryFunny 8mo agoWhy would you assume that Costco returns are due to supplier mistakes? Costco are legendarily permissive with returns, to extent of things like accepting bare stick-like xmas trees back after xmas, and giving a full refund, but ultimately this is to their advantage in encouraging mindless consumerism (which is also the general American model - no-question-no-fault returns are generally an American thing, not a worldwide one). Now, a liberal return policy may work out for Costco, and Costco is obviously a high volume hence desirable customer for a supplier, but if Costco is pushing much of the cost of returns back to the supplier, that does change the picture a bit!
- TurdF3rguson 8mo agoThose returned trees don't get sent back to the supplier, they get deducted from a pre-negotiated spoil allowance which is something separate. The supplier returns will be things like badly stacked palettes.
- internet2000 8mo agoCostco does not treat their suppliers well.
- mmargenot 8mo agoDo you have a source for this? Most information I’ve seen around this (e.g. Acquired podcast, from the Costco side) claims strong positive relationships.
- deleted 8mo ago[deleted]
- VerifiedReports 8mo agoThey also back-stab their business "partners."
- assaddayinh 8mo ago[dead]