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.

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(Photo credit: TSMC)

Recently, TSMC reportedly got approval for the land change and environmental assessment of its third 2nm plant in Kaohsiung.

It is reported that the Nanzih Industrial Park in Kaohsiung City will adapt to the changing needs of the global semiconductor industry supply chain and will carry out the development of the park in stages. TSMC obtained the construction permit for the first phase of its 2nm advanced process plant in the Nanzih Industrial Park in September 2022, kick starting the construction of first phase, with mass production expected in 2025. The second phase of the plant is also underway.

In response to the shift in the supply chain and the market demand of the global semiconductor industry, TSMC has an urgent need to expand production. The Urban Development Bureau of Kaohsiung City Government stated that TSMC chose to initiate the urban plan variation procedure for the third phase of the plant on the east side of the first phase of the park, covering an area of 17.22 hectares.

To ensure that the industrial use category matches the land use content, the special industrial zone will be changed to a Type A industrial zone, and the building coverage ratio will be adjusted to 45% in consideration of the need of construction, while the original floor area ratio of the special industrial zone will remain at 160%.

Regarding the third 2nm plant, the Kaohsiung City Government’s Water Conservancy Bureau issued a statement saying that the city government fully supports TSMC’s establishment of the plant in the Nanzih Industrial Park, and the reclaimed water supply will be fully guaranteed.

As for electricity, the Economic Development Bureau explained that Kaohsiung’s total power generation in 2022 was 50.886 billion kWh, with total electricity sales of 30.734 billion kWh, accounting for only 60% of power generation. In the future, all TSMC plants will adopt a dual-circuit system to ensure stable power supply.

Previously, Tai-Hsiang Liao, Director of the Economic Development Bureau, pointed out in early April that the city government will provide relevant assistance to meet TSMC’s water and electricity supply needs in Kaohsiung. Additionally, Liao further stated that, based on the current land assessment in the park, the maximum scale of TSMC’s Kaohsiung plant could be up to five plants.

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• [News] TSMC Reportedly Invests over USD 12.3 Billion in EUV, Advancing in 2nm Production
• [News] TSMC Reportedly Accelerates 2nm Progress, with Kaohsiung Plant Rumored to Commence First Tool-in by Year-end

(Photo credit: TSMC)

After Micron’s announcement of constructing two new fabs in the U.S. in 2022, the memory giant has now provided more details regarding their production timeline. According to the information the company disclosed in its Q3 FY24 financial report and its conference call, the fabs in Idaho and New York target to start operation between 2026 and 2029, a report from AnandTech noted.

“Fab construction in Idaho is progressing well, and we are diligently working to complete the regulatory and permitting processes in New York,” said Sanjay Mehrotra, CEO of Micron, during the company’s conference call with investors and financial analysts. However, the company admits that the Idaho fab will not contribute to meaningful supply until FY27, while and the New York fab is not expected to contribute to bit supply growth until FY28 or later.

AnandTech further noted that as Micron’s fiscal year 2027 begins in September 2026, the new fab near Boise, Idaho, will likely commence operations between September 2026 and September 2027, while the New York fab is expected to begin operations afterwards. Namely, Micron’s U.S. memory fabs are projected to start operations between late 2026 and 2029.

According to an earlier report by Bloomberg, Micron is expected to receive over USD 6 billion in funding through the “Chips Act” from the Department of Commerce to assist with the costs of local factory projects, as part of efforts to bring semiconductor production back to U.S. soil.

Though its U.S. fabs may not start operation soon, Micron does confirm the strong momentum from HBM, saying that its HBM production capacity has been fully booked through 2025, according to another report by TheElec. The company would be the second memory giant to make such a statement, after SK hynix.

Micron claims that it expect to generate “several hundred million dollars” of revenue from HBM in FY24, and “multiple $Bs” in revenue from HBM in FY25. The company has already sampled its 12-high HBM3E product and expect to ramp it into high volume production in 2025, as it is also confident to maintain the technology leadership with HBM4 and HBM4E.

To support the strong market demand as well as preparing for the mass production for its U.S. fabs, Micron expects to increase its capital spending materially next year, with capex around mid-30s % range of revenue for FY25, which will support HBM assembly and test equipment, fab and back-end facility construction as well as technology transition investment to support demand growth, the company said.

Micron states that its average quarterly capex in FY25 to be meaningfully above the Q4 2024 level of USD 3 billion, which means its capex would be around USD 12 billion, reporting a strong 50% YoY growth comparing to the USD 8 billion in FY24.

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• [News] Memory Giant Micron’s 3Q24 Earnings Report Released, Outlook Slightly Better Than Expected
• [News] Micron Reportedly to Receive Over USD 6 Billion in US Chip Funding

(Photo credit: Micron)

TSMC’s advanced 2-nanometer process capacity is set to begin mass production in 2025, with equipment manufacturers actively delivering machines. According to a report from Commercial Times, the EUV (Extreme Ultraviolet Lithography) machines, crucial for advanced processes, will see over 60 units delivered this year and next, with a total investment exceeding TWD 400 billion (roughly USD 12.3 billion).

As production capacity continues to expand, ASML’s delivery volume in 2025 is expected to grow by more than 30%, benefiting the Taiwanese supply chain. Among them, Gudeng Precision is actively collaborating with ASML on next-generation High-NA EUV development, while other Taiwanese fab tool makers, such as Marketech International and YEEDEX, are also expected to benefit.

As per the same report citing sources, it’s revealed that EUV machine supply is tight, with lead times of 16 to 20 months. Therefore, most orders placed in 2024 will be delivered starting the following year. According to the projections cited by the report, TSMC has ordered 30 EUV machines this year and 35 next year, though these numbers may be slightly adjusted due to capital expenditure plans.

In response to customer demand, ASML planned new capacity last year, with a clear growth trajectory for deliveries next year. Reportedly, the total delivery count for this year is estimated at 53 units, with next year’s count expected to exceed 72 units. Previously, according to a report from Reuters on June 5th, ASML already predicted that TSMC was expected to receive ASML’s latest High-NA EUV lithography equipment sometime this year.

The sources cited by Commercial Times further indicate that ASML’s capacity planning for 2025 remains unchanged, targeting 90 EUV units, 600 DUV units, and 20 High-NA EUV units. On November 14, ASML will hold its 2024 Investor Day, where it will present the latest five-year roadmap.

TSMC’s advanced process capacity is gradually ramping up. For the Tainan 3nm plant, mass production will begin in the third quarter, and EUV machines will be introduced progressively at the P8 plant next year. The Hsinchu Baoshan 2nm plant will see strong EUV equipment demand over the next three years, and the Kaohsiung 2nm plant is also advancing simultaneously.

The increasing number of EUV machines is simultaneously driving the growth in the usage of EUV mask boxes. Reportedly, it’s believed that Gudeng Precision will be among the most benefited companies. Gudeng continues to capture market share for FOUP (Front Opening Unified Pod) by maintaining a clean environment that removes plastic or contaminant particles and delivers ready-to-use products directly to customer sites. Additionally, Gudeng is also involved in collaborative development for ASML’s High-NA EUV.

Read more

• [News] ASML Projects Strong Demand Until 2026, New EUV Shipments Reportedly to TSMC
• [News] Decipher TSMC’s Calm Take on High-NA EUV Lithography Machines: Who May Have the Last Laugh in the Angstrom Era?

(Photo credit: ASML)

According to a report from South Korean media outlet The Financial News, MediaTek, Taiwan’s largest smartphone IC designer, has the opportunity to enter Samsung’s Galaxy S25 supply chain as one of the main chip suppliers for the next generation flagship smartphone. Samsung’s S series smartphones have traditionally adopted a “dual-track” strategy, using both in-house Exynos chips and Qualcomm’s Snapdragon. MediaTek, on the other hand, has declined to comment on this matter.

Samsung’s Galaxy Tab S10 is said to be equipped with MediaTek’s Dimensity 9300+ application processor, marking the first instance of MediaTek’s AP being adopted by Samsung’s flagship tablet, according to a report by the Korean media outlet The Chosun Daily.

The latest report by the Financial News further highlights that MediaTek’s APs have primarily been used in Samsung’s mid-to-low-end smartphones. The decision to use MediaTek’s AP in the Galaxy Tab S10 series, instead of Qualcomm’s or Samsung’s own APs, is a significant shift for Samsung.

The report indicates that Samsung’s Galaxy S25 smartphones will not only use Qualcomm’s Snapdragon 8 Gen 4 chips and Samsung’s own Exynos 2500 chips but may also use MediaTek’s Dimensity chips in some regions. It is speculated that the chip in discussion is the yet-to-be-announced Dimensity 9400. If true, the S25 could be available in versions with Exynos 2500, Snapdragon 8 Gen 4, and Dimensity 9400 chips.

The report cites sources, suggesting that this rumor is not entirely without merit, as Qualcomm’s Snapdragon 8 Gen 4 chip is expected to be 30% more expensive than its predecessor. Currently, the Snapdragon 8 Gen 3 chip is rumored to cost around $190-200 per unit, while the 8 Gen 4 could be priced at $260. Samsung’s consideration of incorporating MediaTek chips, or at least using this possibility as leverage in price negotiations with Qualcomm, is plausible.

Qualcomm has been releasing new flagship mobile chips annually and designing custom versions for Samsung’s high-end phones. For instance, the current Samsung S24 series, including the S24 Ultra and some regional versions of the S24 Plus and S24, use Qualcomm’s tailored Snapdragon 8 Gen 3 chip, designed specifically for Galaxy phones and featuring advanced AI capabilities.

It is worth noting that there is a close collaborative relationship between Samsung and Qualcomm. Some of Qualcomm’s chip manufacturing orders are handled by Samsung’s foundry division, while some of Samsung’s mobile chips use Qualcomm’s main processors. If MediaTek succeeds in integrating its Dimensity 9400 into Samsung’s smartphone supply chain, it would be a significant milestone for MediaTek.

The report from The Chosun Daily also highlighted that from Samsung’s perspective, choosing Dimensity to reduce costs and diversify the supply chain is a sensible decision.

Read more

• [News] Samsung Adopts Dimensity 9300+ Instead of Snapdragon, the First Time for Its Flagship Tablet to Feature MediaTek AP
• [News] MediaTek Announces 4nm Dimensity 7300 Series Chips, Supporting Foldable Devices

(Photo credit: MediaTek)