TSMC Plans Rapid Expansion of U.S. Operations with Advanced 2nm Chip Manufacturing Facilities in Arizona

TSMC is poised for significant expansion of its operations in the United States, following announcements made during its latest earnings call. A key part of this strategy includes the acquisition of an additional parcel of land aimed at broadening the capabilities of its Arizona fabrication facilities.

TSMC’s Strategic Move: Expanding Arizona Fabs to Propel Advanced Chip Production in the US

The surge in demand for semiconductor production in the US, particularly driven by advancements in artificial intelligence, has created an urgent need for TSMC’s services. Giants like NVIDIA, AMD, and Apple are increasingly investing in domestic manufacturing, with TSMC standing as a primary provider of state-of-the-art semiconductors. The Arizona fabs are currently engaged in mass production utilizing the 4nm process technology as of the time of this report.

In this context, TSMC’s CEO highlighted during the Q3 earnings call a vision to advance to N2 and more sophisticated technologies within the US. The announcement of securing a second tract of land signals a commitment to scale their operations effectively in response to robust multi-year demand driven by AI applications.

We are making tangible progress and executing well to our plan. In addition, we are preparing to upgrade our technologies faster to N2 and more advanced process technologies in Arizona, given the strong AI related demand from our customers.

Furthermore, we are close to securing a second large piece of land nearby to support our current expansion plans and provide more flexibility in response to the very strong multiyear AI related demand.

TSMC’s strategy reflects a strong dedication to meeting the soaring demand for advanced semiconductors in the US market. C.C. Wei, CEO of TSMC, has outlined a clear intention to introduce N2 technology in Arizona, reinforcing the company’s commitment to shift high-tech chip manufacturing to the United States. This timeline suggests that while Taiwan currently leads in technology production, TSMC aims to close the gap significantly with the rollout of N2 in Arizona over the next few years.

Construction site with industrial buildings and solar panels under clear blue sky, surrounded by desert landscape. — TSMC Arizona | Image Credits: TSMC

The planned enhancements to TSMC’s Arizona facility, which currently boasts six fabs, demonstrate a strong capability for high-end semiconductor production in the US. Significantly, TSMC plans to become the second company after Intel to initiate 2nm node size production in America, potentially as early as the second half of 2026. Furthermore, there are ambitions to ramp up production to A16 (1.6nm), motivated by the substantial revenue contributions from US clients. This shift represents a pivotal transition in production strategy for TSMC.

As TSMC embarks on this ambitious scaling of operations in the United States, the technology community will keenly observe whether the company will meet the expectations of its American partners. However, the signs thus far indicate a robust commitment to the ‘Made in USA’ narrative from this Taiwanese semiconductor powerhouse.

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