Taiwan Semiconductor Preps New Chip Tech To Supercharge AI Performance By 2027

Taiwan Semiconductor Manufacturing Co TSM is close to finalizing the specifications for a new approach to chip packaging that will meet the demand for more powerful artificial intelligence chips.

The Taiwanese contract chipmaker plans to start small production volumes around 2027, Nikkei Asia reported Tuesday.

Taiwan Semiconductor’s new technology, known as “panel-level” advanced chip packaging, will use a square substrate to accommodate more semiconductors and thus boost computing performance versus the usual 300-millimeter round wafers.

Also Read: China Hits US-Made Chips With Tariffs, But Those Outsourcing To Taiwan Semiconductor Exempt

At a White House press conference on Monday, Nvidia Corp NVDA committed $500 billion to building AI infrastructure in the U.S.

Nvidia is partnering with Taiwan Semiconductor on the four-year initiative. Production of Nvidia’s Blackwell chips is already underway at Taiwan Semiconductor’s Phoenix facility, with assembly operations planned for Texas.

Advanced Micro Devices Inc AMD chief Lisa Su confirmed Tuesday that the company will manufacture more AI servers in the U.S. and begin chip production at Taiwan Semiconductor’s Arizona facility.

For context, President Donald Trump shared plans to slap tariffs on imported semiconductors on Sunday. However, he promised flexibility with some companies in the sector. Trump stressed the country’s focus on the domestic production of chips and semiconductors.

The benchmark S&P 500 index has lost 8% in value since Trump took office on Jan. 20. Additionally, the tariffs could affect the demand-supply balance by making products dearer, thereby affecting companies’ profit margins. The tech sector is already reeling from concerns over the sustainability of the massive AI technology investments.

Taiwan Semiconductor reported first-quarter revenue growth of 41.6% to 839.25 billion New Taiwan dollars ($25.5 billion).

In March, key contract chipmaker chief C.C. Wei announced an additional $100 billion investment in U.S. chipmaking (on top of $65 billion in April 2024)

The investment followed Trump’s verbal attacks on Taiwan “for stealing” the U.S. semiconductor business, which led to massive trade deficits for Washington.

Price Action: TSM stock is down 0.06% to $155.75 premarket at the last check on Wednesday.

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