Apple's upcoming smartphones dubbed as iPhone 6 and 5S will feature new application processors (APs) courtesy of Taiwan Semiconductor Manufacturing Company, according to industry sources.

Reports said Apple is planning to contract the TSMC for iPhone application processors for next year's handset. It is also claimed that TSMC is already readying the necessary equipment at its facilities in anticipation of this. By later this year the company will have moved away from 12-inch silicon wafers to 14-inch wafers using advanced semiconductor fabrication.

However, it is still not confirmed whether the California-based tech giant will continue to use the A7 processors manufactured by Samsung for the iPhone slated for release this year.

The aforementioned claim is backed by sources saying that Samsung Electronics, which produces APs for the existing iPhones, will still manufacture chips for the upcoming model scheduled to be released in the second half of 2013. Nonetheless, Apple appears to be accelerating its plans to minimize its dependence on Samsung, the sources observed, judging from TSMC's pace of expansion at Fab 14.

TSMC broke ground for the phase-5 facility of Fab 14 in April 2012, followed by a beam-raising ceremony in November. Equipment move-in began in less than one year after the facility's ground-breaking, the sources noted. TSMC disclosed previously that the Fab 14, Phase 5 facility would be a second 20nm-capable fab, and is scheduled to begin volume production in early 2014.

Rumour has it that the next iPhone will feature Retina or IGZO screen display, A7 quad core chip processor, iOS 7, 128GB internal storage, 13 mega-pixel camera, and longer battery life. The lack of NFC support on the iPhone 5 was one of the biggest criticisms aimed at Apple's smartphone.

Meanwhile, the cheaper iPhone 5S is rumoured to sport a plastic casing, 4-inch screen display, dual core processor and 8-megapixel camera.

The Apple chief Time Cook also dropped several hints that the upcoming iPhone 6 and 5S will be released later this year. Cook said that no new products are to launch before the end of the year.

Cook also subtly dented rumours that the iPhone 5S could launch as early as June. "Our teams are hard at work on some amazing new hardware, software, and services that we can't wait to introduce this fall and throughout 2014."

It seems that the reports on the delayed release date of Apple products proved to be true. A number of analysts claimed that Apple's smartphones are delayed due to "production issues".

The company has yet to issue a public statement on this, but company shares remained bouyant during overnight trades rising 1% to 449.98 per share.