Samsung In The Lead To Produce Apple’s A9 Chipset

Production for the A9 chipset by Apple Inc. (NASDAQ: AAPL) may still be months away but reports indicate that Samsung Electronics Co. (KRX: 005930) may get the first order of Apple’s future chipset in early 2015.

According to Taiwanese publication DigiTimes, Samsung and semiconductor manufacturer GlobalFoundries may begin producing 14-nanometer (nm) mobile chips for Apple in early 2015 at Samsung’s Fab 8 manufacturing complex in New York. This would be a change from Samsung’s usual production venue in Austin, Texas.

Samsung and GlobalFoundries will reportedly tackle a small volume production of 60,000 chips monthly using Samsung’s new Low Power Enhanced (LPE) process. The 14nm process is more efficient than the currently 22nm process standard used to develop mobile chipsets. According to Extreme Tech, the new process increases chipset performance by 20 percent and decreases power consumption by 35 percent.

Though reports cannot be confirmed, DigiTimes indicates that several of the usual players are in the running to produce the A9 chipset. In addition to Samsung and GlobalFoundries, Intel and the Taiwan Semiconductor Manufacturing Company (TSMC) may also accept orders for Apple’s chipset. In particular, TSMC, which has a longstanding relationship with Apple, may use its 16nm FinFET process for the A9 chipset.

Samsung also has a longstanding relationship with Apple. Though the companies are often more rivals than associates, the Korean manufacturer has produced several chipsets in Apple’s A-series. Samsung is currently producing Apple’s 20-nm A8 chipset, which is expected to power iPhones and iPad models scheduled to release in fall 2014; rumors currently suggest plans for an iPhone 6, iPad mini 3 and iPad Air 2.

It is also possible that two or more manufacturers could produce the A9 chipset. Prior reports indicate that Samsung and TSMC were splitting the production load for the A8; however, TSMC reportedly dropped out due to low yields on its end.

Regardless of which manufacturers produce the chipset, the A9 will likely be included in Apple devices to be announced and released in late 2015. The current A7 chipset, which was also manufactured by Samsung, debuted in the iPad Mini 2 in June 2013, the iPhone 5s and iPhone 5c in September 2013 and the iPad Air in November 2013.

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