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With TSMC’s earnings call coming up on April 17, all eyes are on the foundry giant as it is expected to address key issues in the chip industry amid Trump’s tariff threats and its own take on upcoming challenges. Here’s a quick preview of what to watch for at the event.
Industry Vibes: Intel JV and Rumored UMC/GF Merger
There is a lot going on lately in the foundry battleground. On the advanced node front, a Reuters report notes that TSMC and Intel are in talks to form a joint venture to operate Team Blue’s U.S. factories, with the former said to take a 20% stake in the new venture.
An Economic Daily News report suggests that, compared to options like managing Intel’s foundry division or pursuing technology licensing, this choice would have a lesser impact on TSMC’s long-term growth.
As per Tom’s Hardware, NVIDIA and Broadcom, the world’s two top AI chip firms, are eyeing Intel’s 18A process, with NVIDIA possibly closer to committing than Broadcom. Market rumors also indicate that Intel has secured the GPU gaming socket for the Nintendo Switch 3 on 18A.
Meanwhile, GlobalFoundries and Taiwan’s second-largest foundry, UMC, are rumored to be joining forces in mature nodes, However, this is unlikely to significantly impact TSMC, as UMC focuses on 22/28nm nodes, while GlobalFoundries specializes in 12/14nm.
CoWoS Expansion Concerns
In the meantime, supply chain constraints and geopolitical uncertainties may bring concerns to TSMC’s CoWoS expansion plans, as highlighted by Commercial Times.
The report, citing analysts, notes that TSMC would reassess its CoWoS capacity for 2026 after receiving customer feedback around mid-May.
Commercial Times reports that TSMC’s CoWoS monthly capacity in 2026 is anticipated to reach 105K to 125K units, up from 70K to 75K units by the end of 2025. However, if Trump’s tariff policies stay in place, it could negatively impact the global economy and AI capital spending in the long term.
Tariff Threats: More Investments to Come?
In the January earnings call, TSMC set a 2025 capex target of $38 billion to $42 billion, a 27.5-41% increase from 2024. However, in March, the company pledged an additional $100 billion investment in the U.S. to build three new fabs and two advanced packaging facilities. This has raised concerns about further capex increases, putting pressure on its cash flow.
President Trump reportedly told TSMC it would face a tax of up to 100% if it did not build its factories in the U.S., making the company’s next move highly anticipated. Meanwhile, as Trump’s reciprocal tariffs go into effect on April 9, semiconductors have been temporarily exempted from the import restrictions.
Additionally, following the U.S. Commerce Department’s late 2024 investigation into whether TSMC produced AI chips for Huawei, recent reports indicate that the foundry giant could face a penalty exceeding $1 billion, according to Reuters. The progression of this issue is also worth monitoring.
(Photo credit: TSMC)
