Taiwan chipmaker TSMC to spend another $100 bil. on expanding manufacturing capacity in US
The logo of Taiwan Semiconductor Manufacturing Company (TSMC) at the company's second-quarter earnings conference in Taipei, Taiwan, July 16. Reuters-Yonhap
HONG KONG — Major Taiwan computer chipmaker TSMC said Thursday it plans to spend another $100 billion on expanding its manufacturing capacity in the United States.
The latest commitment appears to bring the company’s total pledges for investment in U.S. chipmaking to $265 billion. It also raised its annual revenue forecast after booking record high profits thanks to runaway demand from the boom in artificial intelligence.
The world's largest contract chip manufacturing and one of the world’s most valuable companies, TSMC’s results are seen as a barometer for the global chip industry and for AI at a time when worries about a potential AI bubble have been buffeting financial markets.
As AI-related demand continues to surge, it has been expanding chip fabrication plants in the U.S., Japan and Taiwan. It said it is increasing its annual capital expenditure budget for this year to $60 billion-$64 billion, up from an earlier estimate of $52 billion-$56 billion.
TSMC, or Taiwan Semiconductor Manufacturing Co., is a key supplier to Nvidia and Apple. It had previously already committed $165 billion in the U.S. for building plants in Arizona, with six fabrication facilities planned.
The extra $100 billion in investments are to “support the strong multiyear demand from our leading U.S. customers,” C.C. Wei, chairman and CEO of TSMC, said during the company's quarterly earnings conference Thursday.
“We believe this investment will help to further foster the development of the U.S. semiconductor ecosystem, strengthen the supply chain and support an increasing number of high-tech, high-paying jobs in the United States,” he said.
AI-related demand globally continues to be “extremely robust,” Wei added, as the “AI megatrend continues to drive the need for more and more computation.”
TSMC on Thursday reported a record 706.6 billion new Taiwan dollars ($22 billion) in net profit for the April-June quarter, up 77 percent from a year earlier, better than what analysts had expected.