Taiwan Semiconductor Begins 4nm Chip Production in Arizona, Eyes $11.4 Billion Q4 Profit

Taiwan Semiconductor Manufacturing Co TSM has commenced the production of advanced 4-nm chips for U.S. customers in Arizona, Reuters cites Commerce Secretary Gina Raimondo.

In November, the contract chipmaker secured a $6.6 billion grant from Commerce Ministry for its U.S. facility in Phoenix, Arizona, covering 3.5 million square feet on a 1,100-acre site. The government also promised up to $5 billion in affordable loans.

Also Read: Taiwan Semiconductor Ramps Up Production in Japan, US, and Germany to Diversify Away from China

The company targets 6,000 workers for its three fabs in Arizona. 

In April, Taiwan Semiconductor agreed to boost its investment by $25 billion to $65 billion and to add a third Arizona fab by 2030 as the artificial intelligence frenzy is in no hurry to slow down.

The Taiwanese chipmaker will produce the 2-nm technology at its second Arizona fab, which will likely begin production in 2028. It also agreed to use the “A16” chip manufacturing technology in Arizona.

Raimondo wants the U.S. to produce 20% of advanced logic chips by 2030, up from 0% before Taiwan Semiconductor began production in Arizona.

International Data Corp expects Taiwan Semiconductor to command a 67% share of the global foundry market in 2025.

Nvidia Corp NVDA is weighing the production of the front-end process of Blackwell AI chips at the Arizona plant. Currently, 92% of the most advanced chips are made in Taiwan, prompting Taiwan Semiconductor to ship the Blackwell chips back to Taiwan for packaging.

The chipmaker’s fourth-quarter revenue amounted to 868.46 billion New Taiwan dollars ($26.3 billion versus a consensus of $26.2 billion), up from $19.62 billion a year ago.

The quarterly revenue is based on  2.89 trillion New Taiwan dollars between January and December 2024 and  2.03 trillion New Taiwan dollars between January and September 2024.

TSMC expects quarterly revenue of $26.1 billion—$26.9 billion. It could post a profit of 377.95 billion New Taiwan dollars ($11.41 billion) for the quarter, Reuters cites LSEG SmartEstimate versus 238.7 billion New Taiwan dollars a year ago.

The company reported a third-quarter revenue of $23.50 billion, up 39%, backed by the demand for 3-nm and 5-nm technologies. Needham had flagged Apple Inc’s AAPL contribution to the 3-nm performance.

Taiwan Semiconductor stock surged 105% in the last 12 months. Investors can gain exposure to the semiconductor sector through EA Series Trust Strive U.S. Semiconductor ETF SHOC and Columbia Semiconductor and Technology ETF SEMI.

Price Action: TSM stock is down 3.01% at $202.12 at the last check on Monday.

Also Read:

• Nvidia, Marvell, Synopsys Demonstrate AI Leadership And Strong Chip Design Momentum: Analyst

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