TSMC Posts Record Revenue as 3nm and 2nm Chips Accelerate US Expansion

TSMC announced on the 9th that its third-quarter revenue reached an all-time high, with gross margins holding steady at approximately 55 percent or higher, reflecting sustained global demand for its advanced process and packaging technologies. In the announcement, Chairman Terry Gou stated that fourth-quarter revenue would increase further, driven primarily by order growth for 5-nanometer, 3-nanometer, and 7-nanometer processes. This performance not only underscores TSMC’s leading position in the global semiconductor supply chain but also highlights its competitive advantage in the high-end chip market.

During the earnings call on the 15th, investors and analysts focused on TSMC’s capital expenditure plans, the progress of its advanced processes, and the development of its packaging technologies. TSMC has disclosed a 2024 capital expenditure estimate of approximately NT$230 billion, with key investments directed toward 3-nanometer, 2-nanometer, and post-7-nanometer processes. The company is simultaneously accelerating research and development in advanced packaging, aiming to enhance chip performance and reduce power consumption. This initiative is expected to further consolidate TSMC’s market share in high-performance computing, automotive electronics, and AI accelerators.

Another area of significant attention is TSMC’s expansion plans in the United States. The company has signed a cooperation agreement with the state of Texas to build a new fabrication plant focused primarily on 5-nanometer and more advanced processes. This move aligns with the U.S. “Made in America 2025” policy and helps reduce reliance on the Taiwan supply chain, thereby mitigating geopolitical risks. Texas’s well-developed infrastructure and talent pool hold strategic significance for TSMC’s efforts to further expand its market share in the U.S.

Additionally, recent reports suggest that TSMC is set to collaborate with Elon Musk’s chip factory, Terafab. Terafab is known for its plans to build a high-performance chip manufacturing base in the United States. A potential partnership would combine TSMC’s mature process technology with Terafab’s localized advantages, potentially accelerating the self-sufficiency of the U.S. semiconductor industry. Although no official announcement has been made, the market has begun assessing the potential of this collaboration to elevate TSMC’s position in the U.S. market and reshape the global chip supply chain.

Overall, TSMC’s strong third-quarter performance, combined with its future capital investments, advanced process roadmap, and expansion plans in the U.S., indicates that its leadership in the global semiconductor industry will continue to strengthen. If the collaboration with Terafab materializes, it will further boost TSMC’s competitiveness in the U.S. market and bring greater flexibility and stability to the global chip supply chain. The market expects TSMC to maintain high revenue and gross margins in the fourth quarter and to achieve substantive progress in its U.S. expansion and partnerships. (Factual source: CNA)