iPhone Chipmaker Suffers Virus Outbreak, Apple Shipments Impacted


The Taiwan Semiconductor Manufacturing Co., the company that makes chips for the iPhone, is reeling from a crippling computer virus as it warns of delayed shipments and a drop in revenue because of the impact of the attack on its factories.

TSMC, the world’s largest contract chipmaker, confirmed over the weekend that a number of its fabrication tools and its computer systems had been infected by a virus. The company said 80 percent of the fabrication tools impacted had been restored following the Friday attack, with a full recovery expected on Monday.

TSMC, incidentally Taiwan’s largest company, blamed the outbreak on a mistake during a routine software installation that then spread throughout its network across factories. Such is the impact of the incident that the chipmaker estimates third-quarter revenue to drop by about 3 percent from $8.55 billion to $8.45 billion while predicting gross margin would slip by nearly 1 percent.

This is the first time a virus has ever led to the slowdown of a TSMC facility, despite the company stating no confidential information was compromised in the virus attack.

“TSMC has been attacked by viruses before, but this is the first time a virus attack has affected our production lines,” Chief Financial Officer Lora Ho told Bloomberg, adding:

“TSMC has taken actions to close this security gap and further strengthen security measures.”

The incident comes at a time when Apple surpassed the market value of $1 trillion, the first time ever for a company, fueled by the sales and appeal of its popular smartphone. Apple is notably TSMC’s largest customer and accounts for over 20 percent of its revenue.

According to the World Economic Forum, cyber crime could cost businesses as much as $8 trillion in damages over the next five years.

Image credit: Pixabay.