Apple chip partner TSMC will achieve growth with the entire chip foundry industry in 2021. Counterpoint Research claims that TSMC is expected to continue to exceed the industry average, with a growth rate of 13% to 16%. Counterpoint analysts are investigating the semiconductor industry and estimate that the entire market will achieve "higher-than-expected revenue" in 2020, and believe that this situation will continue until 2021.

In its forecast for the next year, the company is particularly optimistic about the chip strategy of TSMC and Apple.

Although industry revenue in 2020 will grow 23% year-on-year to US$82 billion, Counterpoint believes that it will grow to US$92 billion in 2021, an annual growth rate of 12%. For TSMC, its predicted sales growth of 13% to 16% in 2021, if realized, will exceed the entire industry. To a certain extent, this will be driven by TSMC’s acceleration of the production of EUV-enabled (extreme ultraviolet lithography) nodes, involving 7nm and 5nm chips. EUV is considered to be a "key factor for continuation of Moore's Law", which increases the transistor density of the chip and thereby improves performance.

At the 5-nanometer level, TSMC will begin mass production in the first quarter of 2020, and Samsung will follow up at least 6 months later. It is estimated that shipments of 5-nanometer wafers in 2021 will account for 5% of global 12-inch wafers, which is higher than less than 1% in 2020. Apple is considered to be the largest customer of 5nm chips in 2021, and all orders are passed through TSMC, which is expected to account for 53% of shipments. This is due to Apple's use of 5-nanometer technology in the A-series chips used in the iPhone and Apple Silicon.

Qualcomm may be the second largest 5nm wafer customer, partly because Apple and the speculated Qualcomm X60 modem may be adopted in the "iPhone 13".

In the 7-nanometer market, Apple is expected to consume only 6% of its wafers in 2021, partly because the market dominated by AMD, Nvidia and Qualcomm is extremely crowded.

"As long as concerns about supply chain disruption continue, chip manufacturers will maintain high inventory levels from the fourth quarter of 2020." Analysts added that this may also make the "seasonal performance better than normal" in the first half of 2020. Because foundry customers will choose to place wafer orders earlier.

The market’s expectation of TSMC’s 2021 revenue of over US$20 billion, a record high, "is reasonable in our opinion," Counterpoint said. "This will be a cross-selling year for TSMC between the two growth pillars of smartphones and HPC."

TSMC is expected to expand its 5nm and 3nm production capacity during 2021, the latter is considered to have been consumed by Apple. As an indicator of future growth, the "capital expenditure to sales ratio" is expected to remain at 40% of this year's peak level.