Apple Inc. (AAPL) chooses Samsung to manufacture A8 processor, despite rumors

Despite strongly supported rumors to the contrary, Apple Inc. (NASDAQ:AAPL) granted the contract to produce the A8 processor chip to Samsung today, rather than to Taiwan Semiconductor Manufacturing Company (TSMC). In mid-February, TechNews Taiwan featured a detailed article that seemed to indicate Samsung was being abruptly phased out of much of the manufacturing process for the A8 following their latest round of legal wrangles with Apple. Today’s news exploded this idea as a groundless rumor.

An anonymous company official of the South Korean electronics titan stated today that the contract for the A8 processor has already been signed with Apple Inc. (AAPL), and that the company is not, in fact, experiencing any problems generating the necessary yield. Production is still to be split with TSMC, but the lion’s share of the manufacturing will be done by Samsung. This sharply contradicts last week’s rumor that TSMC would wholly replace Samsung as the manufacturer, and that the newcomer would do the heavy lifting on making a major release.

Though its technology differs markedly from the A7, and is considerably more advanced – especially in its capacity to handle graphics – the A8 processor will be manufactured at the same location in Austin, Texas that currently makes the A7. This semiconductor plant, located on American soil, will start bulk manufacture of the chips in the second quarter (Q2) of 2014. This should theoretically permit the A8’s Q3 use in the iPhone 6 and possibly other important Apple (AAPL) releases slated for this year, too.

The A8 processor will use 20 nanometer transistors that should enable a significant improvement in graphics rendered by the chip. The increase should be strong enough to be directly perceptible to users, who will be able to run more graphics intensive apps, and stream videos at higher resolutions, on devices powered by the A8. The iPhone 6 will likely feature a quad core CPU rather than the current dual core arrangement. The iPhone 5, with its A7 chip, is already close to the front of the pack when it comes to mobile electronics processing power. The A8 should outdo this performance crisply, challenging its competitors to keep up.

All of these claims, of course, are based on reports and rumors from various South Korean sources, and should be taken with the proverbial grain of salt. Though it seems likely enough that Samsung will be the manufacturer chosen for the A8 processor, the contract is not publicly available and could theoretically be the figment of a Korean reporter’s imagination. Only time will tell who will end up making Apple Inc.’s (AAPL) new processor, but time is running short and production must start soon, whichever firm is selected.