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Analog Devices Strengthens Capacity and Resiliency Through Expanded Partnership with TSMC

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ADI secures long-term chip supply through special arrangement with TSMC's JASM subsidiary, focusing on fine-pitch technology nodes for critical platforms like wBMS and GMSL applications.
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Securing a long-term chip supply is a strategic move that addresses the semiconductor industry's volatility and demand fluctuations. Analog Devices, Inc.'s (ADI) special arrangement with TSMC through JASM ensures a steady supply chain for key technologies like 40nm and finer process nodes, which are critical for advanced applications such as wireless BMS and GMSL. This partnership enhances ADI's ability to meet customer demands promptly, which could lead to increased customer loyalty and potentially higher market share. Moreover, by reinforcing its hybrid manufacturing network, ADI is positioning itself to be less susceptible to external supply shocks, which is particularly important in an industry prone to supply chain disruptions.

The announcement could be seen as a positive signal to investors, as securing long-term wafer capacity can help stabilize production costs and improve profit margins. ADI's proactive approach to supply chain management may translate into a more predictable financial performance, which is generally well-received by the market. Investors will likely monitor how these operational efficiencies reflect in ADI's future financial statements, especially in terms of gross margin and earnings per share. Furthermore, this deal could be an indicator of ADI's commitment to investing in its operational capabilities, which might justify a reevaluation of the company's long-term growth prospects.

From a supply chain perspective, the collaboration between ADI and TSMC through JASM is a testament to the importance of strategic partnerships in mitigating risks. By focusing on 40nm and finer process technology nodes, ADI ensures access to cutting-edge semiconductor technology, which is essential for maintaining a competitive edge. The resilience of ADI's hybrid manufacturing network is crucial for adapting to market changes and customer requirements. This move may serve as a benchmark for other companies looking to secure their supply chains in the face of global semiconductor shortages and could potentially lead to a trend of similar strategic partnerships within the industry.

Special arrangement through JASM secures ADI's long-term chip supply and focuses on 40nm and finer process technology nodes

WILMINGTON, Mass., Feb. 22, 2024 /PRNewswire/ -- Analog Devices, Inc. (Nasdaq: ADI) announced today that the company has made a special arrangement with TSMC, the world's leading dedicated semiconductor foundry, to supply long-term wafer capacity through Japan Advanced Semiconductor Manufacturing, Inc. ("JASM"), TSMC's majority-owned manufacturing subsidiary in Kumamoto Prefecture, Japan.

Building on ADI's more than 30-year partnership with TSMC, this adds another option for ADI to secure additional capacity of fine-pitch technology nodes to serve critical platforms across its business, including wireless BMS (wBMS) and Gigabit Multimedia Serial Link (GMSL™) applications. The joint efforts reinforce ADI's resilient hybrid manufacturing network, which helps to insulate external factors while supporting the means to increase output and scale rapidly to meet customer needs.

"Our hybrid manufacturing network helps deliver a competitive edge to our customers. Together with TSMC, we can serve our customers with more resilient supplies, respond even more rapidly to customer needs and changing market conditions, and focus our investments on innovative manufacturing solutions that benefit society and the planet," said Vivek Jain, Executive Vice President of Global Operations & Technology at ADI. 

"Today's announcement demonstrates TSMC's commitment to helping our customers meet their long-term capacity needs," said Sajiv Dalal, Executive Vice President of Business Development at TSMC North America. "We're delighted to expand our ongoing collaboration with ADI that will help to ensure a steadfast and dynamic journey of semiconductor innovation with robust manufacturing capabilities."

For more information about ADI's resilient hybrid manufacturing network, visit https://www.analog.com/en/who-we-are/resilient-hybrid-manufacturing.html.

About Analog Devices, Inc.
Analog Devices, Inc. (NASDAQ: ADI) is a global semiconductor leader that bridges the physical and digital worlds to enable breakthroughs at the Intelligent Edge. ADI combines analog, digital, and software technologies into solutions that help drive advancements in digitized factories, mobility, and digital healthcare, combat climate change, and reliably connect humans and the world. With revenue of more than $12 billion in FY23 and approximately 26,000 people globally working alongside 125,000 global customers, ADI ensures today's innovators stay Ahead of What's Possible. Learn more at www.analog.com and on LinkedIn and Twitter (X)

All trademarks and registered trademarks are the property of their respective owners.

Forward-Looking Statements
This press release contains forward-looking statements, which address a variety of subjects including, for example, our statements regarding our long-term wafer capacity supply arrangement with TSMC and JASM; our hybrid manufacturing network; and other future events. Statements that are not historical facts, including statements about our beliefs, plans and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: economic, political, legal and regulatory uncertainty or conflicts; changes in demand for semiconductor products; manufacturing delays, product and raw materials availability and supply chain disruptions; products that may be diverted from our authorized distribution channels; changes in export classifications, import and export regulations or duties and tariffs; our development of technologies and research and development investments; our future liquidity, capital needs and capital expenditures; our ability to compete successfully in the markets in which we operate; and security breaches or other cyber incidents. For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to our filings with the Securities and Exchange Commission, including the risk factors contained in our most recent Annual Report on Form 10-K. Forward-looking statements represent management's current expectations and are inherently uncertain. Except as required by law, we do not undertake any obligation to update forward-looking statements made by us to reflect subsequent events or circumstances.

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SOURCE Analog Devices, Inc.

ADI made a special arrangement with TSMC's JASM subsidiary to secure long-term wafer capacity for fine-pitch technology nodes.

ADI focuses on wireless BMS (wBMS) and Gigabit Multimedia Serial Link (GMSL™) applications with this arrangement.

Vivek Jain is the Executive Vice President of Global Operations & Technology at ADI.

Sajiv Dalal is the Executive Vice President of Business Development at TSMC North America.
Analog Devices Inc.

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About ADI

Analog Devices, Inc., also known simply as Analog, is an American multinational semiconductor company specializing in data conversion, signal processing, and power management technology, headquartered in Wilmington, Massachusetts.