TSMC "kisses the Ring" in Trump Chip Fab Announcement

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In the history of the semiconductor industry, Morris Chang is clearly one of the legendary business people and innovators of our times. TSMC’s history is one of triumph and ingenuity for the island of Taiwan, where I happen to live. But is all what it seems in dealing with the Americans?

The U.S.’s relationship with Taiwan now becomes of paramount importance to the history of technology and for companies like Nvidia, whose stock is plummeting so far in 2025 (down 17.5% so far). [Ed: Nvidia is down another 2% so far today]

This big $100 billion announcement comes at an awkward time.

TSMC’s business with the Trump administration involving Intel might also become complicated, reports Judy Lin of TechSoda Newsletter.

As you likely know already:

Recent data suggests that TSMC produces approximately 90% of the world’s most advanced chips, which are critical for various technologies including smartphones and artificial intelligence

• Trump appears to be using threats of tariffs as a negotiation tactic to force allies into deals that don’t favor them or their smaller economies.

Taiwan Enables the U.S. to have access to World’s best Chips

• TSMC says it will build two new chip factories in addition to the three it announced previously. Roughly going from a $65 Billion project to a $165 Billion project.
• That is, Taiwan Semiconductor Manufacturing Co. plans to invest $100 billion in the United States, President Donald Trump said Monday, on top of $65 billion in investments the company had previously announced.
• TSMC began producing 4-nanometer chips at its Arizona plant in January, but its future factories are expected to make chips using “2nm or even more advanced process technology” by the end of the decade, according to the company’s website.

As of around 2023, Apple accounted for approximately 25% of TSMC's total revenue, while Nvidia accounted for about 11% of TSMC's revenue, making it the second-largest customer. These are among two of the most valuable companies in the world and on the U.S. stock market. Companies like AMD, Broadcom and Qualcomm are also major customers.

In 2024, TSMC revised the timeline for its second Arizona plant, saying it will open in 2027 or 2028 instead of 2026. Meanwhile both Broadcom and TSMC have been rumored to be potentially involved in a restructuring of Intel, according to a report by the WSJ on February 15th.

Why this Matters

Broadcom is reportedly considering an acquisition of Intel’s chip-design and marketing business, and would want a partner for the company’s manufacturing business, while TSMC is reportedly looking at controlling some or all of Intel’s chip plants, potentially as part of an investor consortium. This could re-shape the Semiconductor industry especially in the U.S. entirely, based on deals between the Trump Administration and TSMC.

The Trump announcement is therefore fairly interesting:

• The investment is aimed at building five new chip manufacturing plants across the U.S. This not only represents a continued effort to bolster the American semiconductor industry.

Read the full article here.