[News] TSMC’s Capital Expenditure to Surge Next Year, Driven by Rising 2nm Demand

---

---

TSMC’s capital expenditure is set to surge again in 2025 due to strong demand. According to a report from Economic Daily News citing sources, due to continued investment in the most advanced 2nm process and strong demand for 2nm technology, production capacity will be allocated to the Southern Taiwan Science Park. TSMC’s capital expenditure in 2025 is expected to reach between USD 32 billion to USD 36 billion, marking the second-highest in its history, with a year-over-year increase of 12.5% to 14.3%.

Reportedly, the market notes that ASML and Applied Materials will be the main beneficiaries of the increased capital expenditure by the leading manufacturer, and related suppliers are likely to benefit as well. TSMC has declined to comment on market rumors and reiterated that information regarding capital expenditure, and the progress of the 2nm process should be based on the content of the April earnings call next year.

TSMC emphasized at its April earnings call that its capital expenditure and capacity planning are based on long-term structural market demand. Capital expenditure for 2024 is expected to range between USD 28 billion and USD 32 billion. The 2nm process is scheduled to enter mass production as planned in 2025, with the production curve expected to be similar to that of 3nm.

In response to media questions at this year’s shareholder meeting, TSMC Chairman C.C. Wei stated that the previously announced USD 100 billion investment plan over three years was successfully achieved last year. He highlighted that AI presents a bright future for TSMC. He mentioned that capital expenditure and capacity planning are being carefully considered in line with market demand, and whether spending will exceed previous plans remains to be seen.

The sources cited by the same report have further reported that the demand from TSMC’s 2nm customer base has been unexpectedly strong. The related capacity expansion plans are also said to be directed towards the Southern Taiwan Science Park, facilitating process upgrades and creating space for new production.

In the 2nm client landscape, Apple remains a frontrunner, earmarking the technology for flagship smartphones. Intel has also expressed interest, with AMD, NVIDIA, and MediaTek expected to follow suit.

TSMC continues to push forward with its goal of 2nm mass production by 2025. The first fab in Baoshan for 2nm will have equipment installed by April 2024, and the second Baoshan fab will also maintain its schedule. The Kaohsiung fab is planned for 2nm expansion, with the earliest equipment installation expected by the third quarter of 2025. If the STSP also joins in production, mass production could continue to expand from late 2025 into 2026.

Read more

• [News] TSMC Achieved a New Step in the Construction of its Third 2nm Fab
• [News] Apple Not Adopting TSMC 2nm for iPhone 17? A19 Pro Chip Rumored to Use N3P Process

(Photo credit: TSMC)