Zinger Key Points
- TSMC’s $65B Arizona investment will boost U.S. advanced chipmaking share to 21% by 2027.
- Taiwan's global IC market share to drop from 71% to 54% by 2027, retaining top spot.
Taiwan Semiconductor Manufacturing Co TSM is making waves in the semiconductor industry with a $65 billion investment in Arizona, bolstering the U.S.’s advanced chipmaking capabilities. The U.S. will likely secure the second-largest global market share in advanced semiconductor production by 2027, increasing its share from 9% to 21%, the Taipei Times cites from a TrendForce Corp report.
Taiwan Semiconductor is developing cutting-edge 3nm, 2nm, and even 1.4nm processes, with mass production of 3nm chips already underway in Tainan, Taiwan.
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Two advanced fabs in Arizona will begin production in 2024 and 2028, focusing on 4nm and 3nm processes, respectively. A third fab using 2nm or more advanced technology is expected by 2030.
Taiwan, however, will likely see its share of advanced integrated circuit (IC) processes decline from 71% to 54% by 2027. Despite this, Taiwan will maintain its position as the global leader, per the report.
South Korea will likely experience a dip, dropping from 11% to 9%, relegating it to the third spot globally.
The U.S. government’s focus on semiconductor self-sufficiency grows as global competition intensifies. Taiwan Semiconductor bagged up to $6.6 billion in U.S. subsidies and $5 billion in proposed loans to build advanced chip plants in Arizona.
A Boston Consulting Group report estimates that U.S. semiconductor manufacturing capacity could triple by 2032, driven by policies like the CHIPS Act. U.S. capital expenditure on semiconductors will likely constitute 28% of the global total between 2025 and 2032.
Taiwan Semiconductor is ramping up domestic and global expansion efforts. Over the next decade, the company plans to construct new factories annually in Taiwan, with sites in Kaohsiung, Tainan, and Taichung.
The contract chipmaker is also advancing its international projects, including a second facility in Japan’s Kumamoto region set to begin construction in 2025 and advanced plants in Arizona and Dresden. The company continues to innovate in advanced packaging technologies like CoWoS and SoIC to stay ahead in the semiconductor market.
Taiwan Semiconductor forecasts record capital expenditures between $34 billion and $38 billion to support its growth in 2025.
Advanced Micro Devices, Inc AMD has recently tapped Taiwan Semiconductor to foray into the smartphone market, leveraging the chipmaker’s 3nm process to target Samsung’s flagship models.
Taiwan Semiconductor stock surged over 82% year-to-date.
Price Action: TSM stock is down 0.15% at $184.80 premarket at last check Tuesday.
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