Taiwan Maker of iPhone Components Hit by Virus Outbreak

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August 7, 2018

By Ed Adamczyk

A Taiwan semiconductor maker that supplies chips to Apple says shipments will be delayed after a computer virus infected its factories.

Taiwan Semiconductor Manufacturing Co., Taiwan’s largest corporation, makes computer chips for Apple iPhones and other devices. Sunday, it said it expects production facilities to return to normal Monday after a virus was discovered late last week.

TSMC also said 80% of its tooling capability had been recovered, but warned of delivery delays and reduced revenue.

The chip maker blamed the spread of the virus on an error made during software installation, which quickly spread through its network.

The incident reinforces the global nature of the technological supply chain, although it noted that it was the first time a virus had stopped production at TSMC.

The company makes processors for next generation iPhones, and Apple has said three new models will be on the market in the fall. The virus could slow Apple’s unveiling of the new iPhones, though.

Contracts with Apple account for 21% of TSMC’s production.

In a statement, TSMC said it estimated third quarter revenue would fall 3% because of the incident and gross margin would fall by 1%. The company added it was confident recovery would be made in the fourth quarter.

Several weeks ago, TSMC told shareholders it expected a strong second half of 2018 and strong demand for iPhone components.

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