Taiwan Semiconductor raising prices could mean less competition from Intel: Wedbush

What happened

Reports suggest Taiwan Semiconductor could raise chip-on-wafer-on-substrate prices by 10% to 20%. Wedbush analyst Matt Bryson said the reported increase cannot yet be independently validated. Taiwan Semiconductor did not immediately respond to a request for comment from Seeking Alpha.

Confirmed

Global impact / market context

A price increase would signal TSMC has pricing power, meaning it can charge more because demand is strong. That could lift its revenue per chip sold and suggest Intel's competing packaging technology is posing less pressure on TSMC.

Analyst inference

Chip-on-wafer-on-substrate, called CoWoS, is an advanced packaging step needed to combine chips. Wedbush sees it as a likely supply bottleneck again. Higher packaging prices would raise costs for customers such as Apple, Nvidia and AMD.

Analyst inference

What to watch

1. Watch whether Taiwan Semiconductor comments publicly on the reported 10% to 20% chip-on-wafer-on-substrate price increase, since the company did not immediately respond to Seeking Alpha's request for comment. Confirmed
2. Watch whether independent checks confirm the reported CoWoS price increase, since Wedbush said it could not yet independently validate the Commercial Times report. Proposed
3. Watch Intel's EMIB-T packaging technology, because Wedbush said a TSMC price increase could mean TSMC faces less pressure from Intel and implies varied consequences for Intel. Analyst inference

Evidence

• seekingalpha.com