In the microelectronics industry, a semiconductor fabrication plant (commonly called a fab; sometimes foundry) is a factory where devices such as integrated circuits are manufactured.

A business that operates a semiconductor fab for the purpose of fabricating the designs of other companies, such as fabless semiconductor companies, is known as a foundry. If a foundry does not also produce its own designs, it is known as a pure-play semiconductor foundry. If a foundry produces its own designs, it is known as an integrated device manufacturer (IDM).

https://en.wikipedia.org/wiki/Semiconductor_fabrication_plan...

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Note added at 21 hrs (2020-09-13 21:35:47 GMT)
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Unlike Intel, which designs and manufactures its own chips, TSMC only manufactures chips. With that narrow focus, TSMC has become the world’s largest and most advanced contract manufacturer for chipsets.
TSMC already does business with Apple; it manufactures iPhone and iPad chipsets.
https://fortune.com/2020/06/22/taiwan-semiconductors-apple-c...

Any kind of "supply" of anything is always done through some form of "contract" - so "contract chipmaker" can be at first a bit puzzling.

What is meant here is that this company is only making / manufacturing chips "on order" i.e. according to designs given by (known) clients (and these chips would be available ONLY for these "clients" - more accurately "commanditaires" who are in effect "commissioning" the production), as opposed to manufacturing chips designed by themselves for any future (yet unknown) client that could be interested.

If you want a parallel in the language business when you translate a text given by a client that you can only make available to that client it would be a "contract translation", as opposed to, say, you translating your own book from one language to another.


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Note added at 15 hrs (2020-09-13 15:21:08 GMT)
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They also make chips they designed themselves - but the part of their production as "contract manufacturer" is where they make chips designed by the client.

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Note added at 1 day 14 hrs (2020-09-14 14:39:47 GMT)
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ntel is the key supplier to manufacturers of personal computers (about 80% of all PCs have an Intel main processor) but it DOESN'T make Intel a "contract chipmaker" because they make chips of THEIR OWN design.

Anyone can buy an Intel processor, including anyone fancying a D-I-Y assembled PC.

as opposed to

(TSMC) is the world's largest contract chipmaker and a key supplier to Apple.

which means

Apple is designing the chips they need but they couldn't be bothered to make them - they pass the blueprints to TSMC which will make these chips according to Apple's design and sell them ONLY to Apple.




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Note added at 1 day 14 hrs (2020-09-14 14:40:20 GMT)
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Intel is the key supplier to ...

In it 'contract' is actually an adjective, which is qualifying the noun chip. A chip which contracted [means shrunk] is called 'contract chip.