Apple and TSMC have also agreed to work together on shipping more advanced processors next year, according to sources. Apple is now able to reduce its reliance on Samsung to supply orders, giving it more leverage when negotiating prices.
The development means Apple doesn't have to rely solely on Samsung for microprocessors, a critical component that controls applications running in smartphones and tablet computers. By securing an additional supplier, Apple will have more leverage when it comes to price negotiations with its chip suppliers in the future. Through the deal, TSMC adds a high-profile customer that could help support expensive research investments the manufacturer needs to move to advanced technology and will likely boost its overall revenue this year, analysts said.
"Apple's order is a big deal to the company. TSMC has assigned a large team to support Apple as you know this client is very picky," one of the people said.
A recent report claimed that TSMC would begin producing processors for Apple using a 20nm process, as well as a new fingerprint sensor for the iPhone 6.