Taiwan Semi Chief To Skip Trump Inauguration, Calls US Semiconductor Sanctions 'Manageable'

Contract chipmaker Taiwan Semiconductor Manufacturing Co TSM chief C.C. Wei opted to maintain a low profile by skipping President-elect Donald Trump’s inauguration, including donations to the Trump camp, Bloomberg reports.

The inaugural committee raised over $170 million for January events, thanks to donors including Meta Platforms Inc META, Microsoft Corp MSFT, Amazon.com Inc AMZN, Alphabet Inc GOOG GOOGL Google, and Apple Inc AAPL.

Big Tech giant leaders, including Apple’s Tim Cook, Amazon’s Jeff Bezos, and Tesla Inc’s TSLA Elon Musk will attend the inauguration on January 20.

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Reuters reports that Wei blamed the crisis of skilled workers, supply chain gaps, and inadequate chip plant construction regulations for delaying the construction of its Arizona project.

Wei added that Taiwan Semiconductor’s U.S. plant is unlikely to procure the most advanced chip technology before factories in Taiwan due to compliance issues, construction, and other regulations.

Wei told Reuters that building the new Arizona factory took at least twice as long as in Taiwan due to the complex regulations that made it challenging to employ the chipmaker’s latest technology in the U.S. before Taiwan.

Previously, Taiwan Semiconductor stated most of its chip manufacturing would remain in Taiwan, especially for the most advanced chips.

Trump had called out Taiwan during his presidential campaigns for allegedly sabotaging America’s chip industry. He verbally attacked the U.S. CHIPS Act and pledged to slap tariffs on Taiwanese chips. He had also flagged the lack of a formal defense treaty between the U.S. and Taiwan.

Additionally, before handing over the charge to the Trump government, the Biden administration launched another round of artificial intelligence technology sanctions on countries, including China and Russia, to restrict their warfare capabilities.

China has been a key semiconductor market for companies like Taiwan Semiconductor. Washington aims to maintain its semiconductor position dominance and share control with its allies, including Taiwan, the Netherlands (home to ASML Holding ASML), and South Korea (home to Samsung Electronics SSNLF).

Wei told Bloomberg that he found the semiconductor sanctions “manageable” and does not expect them to affect chips for non-AI sectors such as cars and crypto-mining.

On Thursday, Taiwan Semiconductor reported fourth-quarter revenue of $26.88 billion (NT$868.46 billion), up 38.8%, topping the consensus estimate of $26.28 billion.

As its 3-nm and 5-nm technologies gained traction, the chipmaker’s gross margins expanded by 600 bps to 59%.

It expects first-quarter 2025 revenue of $25.0 billion—$25.8 billion versus the $24.97 billion consensus. It projects a gross margin of 57%—59%. Taiwan Semiconductor committed $38 billion—$42 billion to fiscal 2025 capex versus actual capex of $29.8 billion a year ago. 

During the earnings call, Wei expressed conviction in producing chips of the same quality in Arizona as in Taiwan with a smooth ramp-up process.

Taiwan Semiconductor stock surged 109% in the last 12 months.

Investors can gain exposure to companies engaged in the manufacturing of semiconductors through VanEck Semiconductor ETF SMH

and iShares Semiconductor ETF SOXX.

Price Action: TSM stock traded higher by 0.20% to $215.21 premarket at the last check on Friday.

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