Unknown computer virus halts factories that make iPhone chips

Maker of iPhone chips says virus-caused factory shutdown will end soon

One of the world’s largest manufacturers of semiconductors and processors has been forced to halt operations due to a computer virus that has affected several of its factories. According to Bloomberg, a computer virus disrupted production at several factories owned by Taiwan Semiconductor Manufacturing Co. on the evening of Friday, August 3.

Many of the details surrounding the virus remain unclear. No individual or organization has taken credit for the attack though TSMC representatives have said that the virus was not introduced by a hacker. As of right now, TSMC has not stated whether this virus was a form of ransomware or something else, so details are scarce. TSMC has said that the virus affected several of its fabrication tools though the problem has been contained. Some of the affected factories have resumed operations, but several will remain closed until at least the sixth.

On Sunday, TSMC released a statement providing additional information regarding the virus’ impact. The company said that it expected to resume full operations by Monday, August 6, but noted that the virus had caused production issues. The company said it expects the issue to cause revenue and shipping to fall in the third quarter, but was confident the company would recover its losses in the fourth.

“TSMC expects this incident to cause shipment delays and additional costs. We estimate the impact to third-quarter revenue to be about three percent, and impact to gross margin to be about one percentage point. The company is confident shipments delayed in third quarter will be recovered in the fourth,” the company’s statement said.

During a phone call with Bloomberg, a TSMC representative acknowledged that the company had been hit by viruses before, but never one quite this bad.

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

Regardless of the details behind the attack, it clearly comes at a bad time for TSMC. The company is currently the sole producer of the processors that power Apple’s iPhones and it was in the midst of ramping up for the launch of the company’s latest smartphones. Currently, we don’t know what impact, if any, this virus will have on the production of the new iPhone or on TSMC in general. During the course of her conversation with Bloomberg, Ho declined to give any specifics regarding the financial impact of this attack.

Aside from this issue, both Apple and TSMC are having a good year, with Apple boasting a market value in excess of $1 trillion. For its part, TSMC is predicting strong growth in the latter half of this year thanks in large part to its work with Apple on the iPhone.

Updated on August 5 with additional information from TSMC. 

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