Alphabet's (GOOGL) Waymo is reportedly building custom chips for robotaxis using TSMC (2330 TT/TSM) for custom-designed silicon, Bloomberg reports

Hyperscalers moving from merchant silicon to in-house design, taped out at TSMC, is by now an established pattern rather than a novelty: the large platform names have each built custom accelerators for their core workloads, and automotive or edge inference has followed the same route as fleet scale makes the economics of bespoke silicon work. The mechanism that matters is margin and supply, not revenue: custom parts replace third-party chip purchases on a per-unit basis, so the read-through runs to Waymo's unit-cost curve and to the incumbent automotive and robotaxi silicon suppliers that lose the socket, while TSMC's advanced-node demand from non-traditional customers broadens. The distinguishing question is volume: custom silicon only pays at scale, so the report implicitly says something about Waymo's expected fleet trajectory, which is the variable peers and suppliers will triangulate against. Worth noting is that single-source foundry dependence has historically concentrated risk in these arrangements, with second-sourcing and packaging capacity the usual follow-on stories. Comparable announcements have tended to reprice the displaced chip vendors more durably than the adopter, where the effect is spread over years of depreciation rather than any one quarter.