Taiwan Semiconductor Manufacturing Company (TSM) is focused on advancing its 2nm technology, both in the domestic market and internationally, despite numerous challenges. These efforts come amid geopolitical tensions, supply chain issues and natural disasters. Nevertheless, the implementation of 2nm technology at the new Baoshan factory in Hsinchu remains on schedule for 2025. According to supply chain sources, the price of the Huguoshengshan 2nm wafers will be twice that of 4nm and 5nm wafers, exceeding $30,000. This highlights Taiwan Semiconductor’s unique market position, which is reflected in its pricing power. Demand for the company’s advanced manufacturing technologies remains high, particularly for applications in artificial intelligence and smartphones. At the same time, the company is facing pressure from market declines and delivery problems. Investments in new production facilities are enormous; Research shows that developing the 3nm process costs $4 to $5 billion, while building a 3nm factory requires at least $15 to $20 billion. Taiwan Semiconductor plans to produce 2nm chips in at least two US factories currently under construction. The company is investing over $65 billion in the Arizona plant alone. Key customers for this location include Nvidia, Advanced Micro Devices and Apple. In a recently expanded collaboration with Amkor Technology, a chip packaging and testing services provider, Taiwan Semiconductor plans to move advanced packaging and testing capabilities to Arizona to capitalize on the AI craze. Amkor plans to invest $2 billion in a facility in Peoria, Arizona. This collaboration includes the joint development of CoWoS (Chip on Wafer on Substrate) and Integrated Fan-Out (InFO) technologies. Nvidia is using Taiwan Semiconductor’s CoWoS chip packaging technology to boost computing power for its high-performance graphics processors. Apple uses InFO packaging technology for the processors of its iPhones and MacBooks. Last year, Taiwan Semiconductor’s stock price rose over 107%.
