“It’s Extremely Sensitive” – Apple Chipmaker Crippled By Computer Virus

Having conquered the ‘four commas’ club for the first time, a chink in Apple’s armor appeared late Friday night when a computer virus crippled iPhone’s sole chipmaker’s factories – halting all production.

As BloombergQuint reports, Taiwan Semiconductor Manufacturing (TSMC) plants were severely disrupted after a number of its fabrication tools had been infected by the virus, and while it had contained the problem and resumed some production, several of its factories won’t restart till at least Sunday.

“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 News by phone.

She wouldn’t talk about how much revenue it would lose as a result of the disruption, or whether the facilities affected were involved in making iPhone chips.

The degree of infection varies by fab. Certain fabs returned to normal in a short period of time, and we expect the other fabs will return to normal in one day,” the company said in its Saturday statement.

As The Nikkei Asian Review reports, “it’s extremely sensitive,” an industry source familiar with the matter said on condition of anonymity.

“The news has spread across the industry since late Friday night. The computer virus was first detected in TSMC’s 12B facility.”

The source said this facility is TSMC’s most essential research and development base and is near the company’s headquarters.

The R&D plant “holds crucial production data and leading nanotechnology blueprints,” the source said.

The virus comes amid a burst of alleged industrial espionage cases.

In early July, U.S. authorities charged a former Apple employee with theft of trade secrets. According to reports, the former employee, Xiaolang Zhang, had disclosed his intention to work for a Chinese self-driving car startup and booked a last-minute flight to China — after downloading the plan for a circuit board for Apple’s self-driving car.

On Wednesday, a General Electric engineer in New York state with ties to businesses in China was arrested for allegedly stealing trade secrets related to GE turbine technology.

The virus attack on TSMC’s computer systems also comes as trade tensions and a technology cold war escalate, mostly between Washington and Beijing.

It’s unclear who targeted TSMC (though for now “Russians” have not been mentioned… or Samsung… or China), but the company added in a statement that the virus wasn’t introduced by a hacker.

The implications are also unclear for trillion-dollar Apple.

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Author: Tyler Durden