Recent developments at Taiwan Semiconductor Manufacturing Company (TSMC) have spotlighted its positioning as a significant player in the semiconductor industry. TSMC's stock experienced a notable increase of 4.12% on November 7, highlighting investor confidence amidst competitive challenges and strategic advancements. This surge comes as the company continues to dominate the advanced chip manufacturing sector, particularly in 3nm technology, where it supplies major clients such as Apple and Qualcomm.
TSMC's strategic expansions are further exemplified by its upcoming facility in Arizona, poised to bolster its production capacities with an initial focus on 4nm technology, set to commence production in early 2025. Plans are already underway for additional facilities targeting 3nm and potentially 2nm processes by 2030. This move represents TSMC's first major venture into overseas production of advanced nodes, amplifying its global footprint and responding to escalating demand from technology giants across the globe.
As global demand for high-performance chips intensifies, TSMC is also at the forefront of advanced packaging solutions, particularly with its system known as Chip on Wafer on Substrate (CoWoS). This technology is vital for high-throughput computing due to its ability to enhance integration density and reduce power consumption. Industry projections from TrendForce anticipate a substantial 150% increase in TSMC's CoWoS capacity by 2024, further expected to rise by 70% annually going into 2025, driven largely by increasing orders from companies such as NVIDIA, AMD, and others seeking cutting-edge solutions for AI and data-intensive applications.
The ongoing expansion in TSMC's CoWoS capacity underscores its critical role in the semiconductor supply chain, despite the challenges of meeting overwhelming market demands. In a bid to optimize capacity, TSMC is exploring external partnerships to outsource parts of its CoWoS production. Concurrently, strategic investments in new facilities, such as those in Chiayi Science Park, aim to bolster its production capabilities. The company projects that CoWoS monthly output could exceed 9.2 million units by 2025, a testament to TSMC's commitment to addressing the dynamic needs of the tech industry.
Looking ahead, TSMC is contemplating price adjustments for both its 3nm processes and CoWoS packaging technologies to reflect the rising costs and value brought by these advancements. With a potential price increase ranging from 5% to 20%, these adjustments might pose cost challenges to clients yet reaffirm TSMC's stature as a leader in semiconductor innovation. The persistent demand underscores TSMC’s pivotal role in propelling the global shift towards more sophisticated semiconductor solutions, cementing its status as a titan in the ever-evolving tech landscape.