Apple Begins Making A16 Chips in Arizona
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Last year, Apple silicon supplier Taiwan Semiconductor Manufacturing Company (TSMC) expanded into the US with a new plant in Arizona, and now it looks like Apple is getting ready to use that domestic facility to produce one of its mainstream A-series chips.
It may not be the latest A18 chips found in the iPhone 16 lineup, but according to independent journalist Tim Culpan, Apple is testing the waters in a big way, with a run of older A16 chips used in the iPhone 14 Pro and iPhone 15 models.
Apple’s A16 SoC, which first debuted two years ago in the iPhone 14 Pro, is currently being manufactured at Phase 1 of TSMC’s Fab 21 in Arizona in small, but significant, numbers, my sources tell me. Volume will ramp up considerably when the second stage of the Phase 1 fab is completed and production is underway, putting the Arizona project on track to hit its target for production in the first-half of 2025.Tim Culpan
Unlike Apple’s more recent chips, the A16 was produced using the older 5 nanometer (5nm) process, which may be all the Arizona facility is currently capable of handling. Last year, Apple switched over to a 3nm process for the M3 Macs and the iPhone 15 Pro’s A17 Pro, and more recent M4 and A18 chips are believed to be using a second-generation version of that 3nm process.
Culpan’s sources tell him that the same N4P process used to fabricate the A16 chips in Taiwan is also used in Arizona. TSMC calls that an “enhanced” version of 5nm that some have called a 4nm process, but it’s still part of the 5nm family, which has led to some confusion. Either way, the resulting A16 chips should have the same specs and quality.
The yields for the A16 in Arizona are said to be “slightly behind” the Taiwanese lines, but they are pretty close, and TSMC is working to make rapid improvements that should result in yield parity soon enough.
The A16 chip may not be the only chip in production at TSMC’s Arizona facility, but it’s certainly the highest-profile. Culpan noted that he was expecting Apple to go with something more modest, like the H-series chips for Apple’s AirPods; the choice to go with the A16 is a much more ambitious move.
I was surprised when I heard it was the A16. The fact that they went for the most-advanced chip they could manage on US soil, in terms of both technology and volume, shows Apple and TSMC want to start big.Tim Culpan
Why the A16?
The production of A16 chips raises questions about what devices they could be earmarked for. Culpan speculates that it could be upcoming iPads or the next-generation iPhone SE, but those are both unlikely candidates. Reliable sources suggest the “iPhone SE 4” will support Apple Intelligence, which means it will get at least an A18 chip. That’s par for the course anyway, as Apple has always put a current-generation chip in each new iPhone SE, matching the mainstream iPhone models released the previous fall.
Apple is expected to unveil two new iPads next month—an 11th-generation iPad and an iPad mini 7 — but both are equally likely to gain Apple Intelligence support. With AI being its marquee feature for 2024, it seems unlikely that Apple will leave any new iPhones, iPads, or Macs out of the party. While an A16 chip made sense for an iPad mini that would have arrived last year, most current reports suggest it will get at least an A17 Pro chip. Meanwhile, the 11th-gen iPad could go to an M1.
While there’s a slight possibility that an A16 chip could find its way into a new Apple TV or HomePod, these aren’t produced and sold at sufficient volumes to justify setting up a whole new fabrication line.
What’s more likely is that Apple is cranking out the older silicon not for new hardware but to keep its supply of existing iPhones going.
While the iPhone 14 Pro models that introduced that chip in 2022 have long since been put out to pasture, the A16 is also used in the iPhone 15 and iPhone 15 Plus. These are still part of Apple’s iPhone lineup, and the 6.1-inch model will likely continue being sold until late 2026.
Apple isn’t merely keeping these older iPhones on the market to clear out old stock. It’s still manufacturing them and will continue making them for at least another 18 months. Even after the iPhone 15 lineup was released in late 2023, the iPhone 14 remained one of the top ten best-selling smartphones over the past 12 months, and there’s no reason to assume that trend won’t continue with the iPhone 15.
The iPhone 15 will undoubtedly be a similarly popular alternative to this year’s iPhone 16, especially with carriers sweetening the pot with zero-cost contract deals. That means Apple still has tens of millions of iPhone 15s to crank out before it rides off into the sunset and will need a lot of A16 chips to put inside those.
