The global chip war for manufacturing supremacy has entered a new phase as Nvidia (NVDA) and Apple (AAPL) battle for crucial capacity at the world’s most advanced foundry, TSMC (TSM). Reports indicate that Nvidia has secured exclusive access to TSMC’s next-generation A16 process node, a move that highlights how AI hardware demand is shifting supply priorities.
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The A16 process integrates nanosheet transistors and Super Power Rail (SPR) technology, promising a major leap in performance and efficiency essential for the most demanding AI processors. Nvidia plans to adopt the A16 process for its upcoming Feynman GPU architecture, scheduled for release around 2028, solidifying its pursuit of AI dominance.
Apple Focuses on N2 and A14 Nodes
While Nvidia locked down the bleeding-edge A16 node, Apple appears to be focused on securing large volumes of capacity for the slightly less advanced, but equally critical, 2nm (N2) and A14 process technologies. Apple is reportedly set to secure more than half of TSMC’s initial 2nm supply to fuel its upcoming A20 chipsets for the iPhone 18 series and the M6 line for its MacBooks.
Apple’s focus on A14 (1.4nm-class) and the 2nm N2 node highlights a strategy geared toward high-volume mobile and consumer applications. The A14 process, which is based on second-generation nanosheet transistors, offers up to a 15% speed increase and 30% power reduction compared to the N2 node, making it ideal for the power efficiency demanded by future smartphones and laptops.
A16 Technology Ushers In The SPR Era
The A16 process, which is expected to enter mass production around 2027, marks a fundamental shift in chip design. It is the first TSMC node to utilize the Super Power Rail (SPR) backside power delivery network (BSPDN) technology. This innovation fundamentally restructures how the chip is powered.
By moving the main power wiring to the back of the chip, SPR frees up space on the front for signal routing. This greatly reduces wiring congestion and noise interference, which are critical for the ultra-high density of AI chips. This technological advantage is specifically what Nvidia is targeting for its future high-performance computing (HPC) and AI accelerators.
CEO Visits Signal a High-Stakes Battle
The competition for TSMC’s capacity is intense. This reflects the high financial stakes in the AI race. Nvidia CEO Jensen Huang has made repeated high-profile visits to Taiwan, highlighting the company’s deepening partnership and its relentless push to secure manufacturing priority over rivals.
The scarcity of supply at the most advanced nodes means that while multiple customers might want the best chip, only one can secure the first and largest tranche of production. The current capacity constraint, where AI chip demand far outweighs supply, forces even giants like Apple and Nvidia into a fierce competition for every available wafer.
To sum up, Nvidia has successfully positioned itself as the sole initial customer for TSMC’s A16 node. It has secured a vital edge for its future AI GPU architectures. While Apple remains a critical anchor for TSMC, this shift highlights how the soaring demand for AI hardware is now dictating capacity priorities for the world’s most advanced chip foundry.
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