TSMC is set to expand its $165 billion U.S. investment — here’s what we know

Buoyed by yet another blockbuster earnings report and a new U.S.-Taiwan trade agreement, Taiwan Semiconductor Manufacturing Co. is poised to accelerate its multibillion-dollar expansion in Arizona. The world's largest contract chipmaker has already committed $165 billion in the U.S., aligning with Washington's push to rebuild its domestic chip manufacturing. But TSMC executives have signaled that spending will rise even further as the company expands capacity to meet demand for artificial intelligence chips. Speaking Thursday with CNBC's Emily Tan, TSMC Chief Financial Officer Wendell Huang said the firm would continue to ramp up its investments in Arizona. "We have strong conviction on the AI mega trend, and that is the reason we are stepping up the capital expenditures to expand in Taiwan and in the U.S.," Huang said. " Not just to expand, but also try to accelerate where it is possible to satisfy or narrow the gap ." The comments came just hours after Chief Executive Officer C.C. Wei said on the company's quarterly earnings call that TSMC had recently purchased additional land in Arizona and planned to build a "gigafab cluster" in the state. While the company did not disclose the dollar value of its planned expansions in the U.S., it forecast capital expenditure in the new year to increase over 30% at the midpoint compared with 2025. Trade deal timing The Arizona expansion coincides with a U.S.-Taiwan trade deal signed Thursday that caps U.S. tariffs on Taiwanese goods at 15%, down from 20%, without stacking on existing rates. Under the agreement, Taiwanese firms commit $250 billion in direct U.S. investments across semiconductors, AI and related sectors, along with $250 billion in credit guarantees to strengthen supply chains. The deal also grants favorable treatment for chips, supporting efforts to reshore manufacturing to the U.S. It demonstrates that our manufacturing excellence can be repeated in the U.S.Wendell HuangChief Financial Officer, TSMC Ahead of TSMC's earnings release and the trade deal, the Wall Street Journal reported that the Taiwanese chip giant had been planning a significant expansion in Arizona as part of trade negotiations between the U.S. and Taiwan, citing confidential sources. However, on Thursday, Huang denied that its U.S. investment plans were directly tied to those trade talks. "The [U.S.-Taiwan] trade deal is between two governments, and we are not part of the discussions," he said. "But what I will say is we are continuing to invest and accelerate our investment in Arizona because of customers' demand, and we actually are making very good progress with our [first fab] in Arizona being up and running. U.S. progress The push to expand follows progress at its current U.S. facility following years of delays and concerns. According to executives, TSMC's first fabrication plant, which has already begun mass production, is now producing chips with yields and technology levels comparable to those of the company's leading facilities in Taiwan. "It demonstrates that our manufacturing excellence can be repeated in the U.S. It's very meaningful for ourselves, and it's also very meaningful for our...

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