iPhone processor manufacturer TSMC hit by malware that shut down fabrication plants

• The malware infected TSMC’s network when the company was installing software for a new tool on August 3.
• TSMC claims that it recovered 80 percent operational capacity over the weekend and expects to be fully operational by August 6.

TSMC, which makes chips for Apple's iPhones among other devices, acknowledged that it fell victim to a malware attack on August 3, which the company said occurred due to “misoperation”. The malware infected the company’s networks when TSMC was installing software for a new tool on Friday. The attack reportedly shut down the iPhone processor manufacturer fabrication plants for a brief period.

The Taiwan-based chip manufacturer said that it recovered nearly 80 percent operational capacity over the weekend and expects to be fully operational by August 6. The firm said that it expects the attack and consequent plants’ shutdown will likely cause shipment delays and additional costs.

“This virus outbreak occurred due to misoperation during the software installation process for a new tool, which caused a virus to spread once the tool was connected to the Company’s computer network,” TSMC said in a statement. “Data integrity and confidential information was not compromised. TSMC has taken actions to close this security gap and further strengthen security measures.”

The chipmaker said that it has already notified most of its customers about the malware attack and hopes to work with them on their wafer delivery schedule.

“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 quarter 2018, and maintains its forecast of high single-digit revenue growth for 2018 in U.S. dollars given on July 19, 2018,” TSMC said.