TSMC’s New Premium Chips Hit $30k per Wafer – Arizona Factory Achieves Profitability for Second Quarter in a Row

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The Taiwan Semiconductor Manufacturing Company (TSMC) is reportedly set to charge up to $30, 000 per 2-nanometer wafer, as indicated by a recent publication from Korean media. Positioned as the foremost contract chip manufacturer globally, TSMC aims to implement these premium prices to foster competition among leading tech giants like NVIDIA, Apple, and AMD. This pricing strategy sharply contrasts with that of its rival, Samsung, which emphasizes competitive pricing and a rapid supply response.

Profitability Milestone Achieved by TSMC’s Arizona Facility

A detailed report outlines TSMC’s plans to leverage a high price point for its advanced 2nm process. Set to begin mass production soon, the strategy aims at maximizing profitability by attracting only those firms capable of investing in top-tier technology. Traditionally, products utilizing TSMC’s cutting-edge technology are mainly acquired by Apple, although NVIDIA and AMD are positioning themselves to compete for these high-value products as well.

With a yield of about 60% for its 2nm chips, TSMC has signaled readiness to commence large-scale production. In comparison, its chief competitor Samsung is operating at a yield of just 40%, leading to its efforts to entice customers by presenting lower prices and more agile delivery options. Given TSMC’s reputation as a leading chip manufacturer, its production capacities are frequently booked ahead of time, which gives Samsung a strategic opportunity to carve out a niche in the emerging 2nm sector.

Samsung secures $16.5 billion chip order deal for its 2nm GAA process — Image Credits: TSMC

Further insights from a different report from Taiwanese sources reveal that TSMC’s Arizona manufacturing plant generated a profit of NT$4.2 billion in the second quarter, marking its second consecutive quarter of profitability. Notably, this is the first instance where the facility has contributed positively to its parent company’s earnings. Despite earlier concerns over high production expenses in the U. S., the rising profitability suggests that domestic demand is now surpassing those costs.

In the initial quarter of this fiscal year, the Arizona fab recorded a profit of NT$496 million after beginning volume production with their 4-nanometer technology in the fourth quarter of 2024. The facility counts key players such as Apple, NVIDIA, and AMD as significant clients, ensuring a consistent pipeline of lucrative orders. This commitment to the U. S.market has driven TSMC to invest heavily in setting up advanced manufacturing sites domestically, unlike its other international endeavors like those in Japan, which do not focus on next-gen chips.

However, analysts caution that the depreciation costs associated with U. S.factories may affect future profitability. The facility in Japan has already reported losses in the first half of the year, and TSMC aims to bolster its production capabilities in the U. S.by establishing two additional factories.

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