On 16/7, chip manufacturer TSMC announced an additional 100 billion USD investment in Arizona, US, following the release of record Q2 net profits driven by AI hardware demand. The company is currently the world's largest contract chip manufacturer, primarily supplying companies like Apple and Nvidia.

This investment will fund the construction of additional chip manufacturing plants in Arizona, bringing TSMC's total capital poured into the US to 265 billion USD.

In March, then-US President Donald Trump and TSMC CEO C.C Wei stated that the chip manufacturer planned to spend 100 billion USD to build 5 factories in the US over the next few years. Previously, in 4/2024, the Taiwanese chip maker announced it would increase its US investment by an additional 25 billion USD, totaling 65 billion USD.

TSMC Chairman and CEO C.C Wei at a press conference in Taipei on 17/6. Photo: AFP

TSMC is currently benefiting significantly from the global AI race. Governments and technology giants are investing heavily in building data centers to train and operate AI tools such as chatbots, image generation programs, and AI agents capable of autonomously performing various tasks.

This trend has significantly boosted the business of chip manufacturers like TSMC, leading to chip scarcity and soaring prices. "Major AI trends continue to drive the demand for increased computing power. We expect 2026 revenue to grow more than 40% year-on-year, calculated in USD," C.C Wei stated during the earnings announcement.

TSMC's net profit in Q2 increased by 77% year-on-year, reaching 706,6 billion New Taiwan dollars (22 billion USD). This figure significantly surpassed analyst forecasts and exceeded the Q1 record of 572,4 billion New Taiwan dollars. Q2 revenue rose by 36% to 1,300 billion New Taiwan dollars.

Wei noted that TSMC is expanding its chip production capacity in Taiwan, Japan, and the US "as quickly as possible" to meet customer demand. "The gap between supply and demand remains very large, so we are doing our utmost to narrow it," Wei said.

According to Chief Financial Officer Wendell Huang, the Taiwanese chip manufacturer will increase its capital expenditure budget for this year to 60-64 billion USD. "At TSMC, high capital expenditure always comes with more growth opportunities in the coming years," Huang stated, adding that they do not anticipate "any bottlenecks with capacity expansion plans."

Before the Taiwanese chip manufacturer announced its earnings, William Li, an analyst at Counterpoint Research, commented that the strong revenue growth indicates "investment in AI infrastructure remains very dynamic, despite macroeconomic instability."

"Demand for AI GPUs, AI ASICs, and advanced chip packaging technology will continue to exceed expectations," he affirmed to AFP.

By Ha Thu (AFP)