Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday announced plans to build a new plant in Japan next year to produce 22-nanometer and 28-nanometer chips in its latest effort to expand its global manufacturing footprint.
The Japanese fab is to start operations in 2024, the world’s biggest contract chipmaker said, ending months of speculation.
“We have received strong commitment to supporting this project from our customers and the Japanese government,” TSMC chief executive officer C.C. Wei (魏哲家) told a quarterly investors’ conference.
Photo: Ann Wang, Reuters
“We believe the expansion of our global manufacturing footprint will enable us to better serve our customers’ needs and reach global talent, while earning a proper return from our investments and deliver long-term profitable growth for our shareholders,” he said.
Wei declined to disclose more details about the capacity and financial arrangements for the fab, and the company did not directly answer whether it would be a joint venture.
The chipmaker said it would consider joint ventures with other companies or key customers on a case-by-case basis when building plants overseas.
Normally, TSMC owns 100 percent of its overseas operations, such as those in China and the US.
Last week, Nikkei reported that TSMC and Sony Group are considering building a plant in Kumamoto Prefecture to make chips used in automobiles and camera image sensors.
The total investment could reach ￥800 billion (US$7.04 billion), with half of the amount coming from the Japanese government, the report said.
Apart from Japan, Wei said that TSMC would not rule out the possibility of building fabs elsewhere, including in Europe.
Japanese Prime Minister Fumio Kishida yesterday welcomed TSMC’s decision, saying that it would contribute to the country’s chip self-sufficiency.
Even with massive capital expenditures in the pipeline, the Hsinchu-based chipmaker yesterday raised its long-term gross margin forecast to more than 50 percent, rather than just 50 percent.
Gross margin this quarter is expected to be 51 to 53 percent, compared with 51.3 percent last quarter, TSMC said.
Revenue is to reach US$15.4 billion to US$15.7 billion from US$14.88 billion last quarter, representing quarterly growth of 3.5 to 5.5 percent.
“Moving into the fourth quarter, we expect our sequential growth to be supported by our industry-leading 5-nanometer technology,” Wei said. “Based on our fourth-quarter revenue guidance, our revenue this year is expected to grow 24 percent year-on-year in US dollar terms.”
Wei also said that the company is making progress in developing next-generation technologies.
TSMC is on track to start initial production of 3-nanometer chips later this year before entering volume production of chips used in smartphones and high-performance computing applications in the second half of next year, Wei said, refuting speculation about a delay in efforts as reported by a foreign investment consultancy.
The 2-nanometer chips are to come out in 2025, he said.
TSMC yesterday gave a positive outlook for chip demand in expectation that its capacity would remain tight this year and through next year.
The chipmaker’s remarks came after reporting another record quarterly net profit of NT$156.26 billion (US$5.56 billion) during the quarter ending Sept. 30. That represented annual growth of 13.8 percent from NT$137.31 billion, or quarterly growth of 16.3 percent from NT$134.36 billion.
Earnings per share rose to NT$6.03 last quarter from NT$5.3 a year earlier and NT$5.18 a quarter earlier.
Additional reporting by Reuters
GET TO SAFETY: Authorities were scrambling to evacuate nearly 700 people in Hualien County to prepare for overflow from a natural dam formed by a previous typhoon Typhoon Podul yesterday intensified and accelerated as it neared Taiwan, with the impact expected to be felt overnight, the Central Weather Administration (CWA) said, while the Directorate-General of Personnel Administration announced that schools and government offices in most areas of southern and eastern Taiwan would be closed today. The affected regions are Tainan, Kaohsiung and Chiayi City, and Yunlin, Chiayi, Pingtung, Hualien and Taitung counties, as well as the outlying Penghu County. As of 10pm last night, the storm was about 370km east-southeast of Taitung County, moving west-northwest at 27kph, CWA data showed. With a radius of 120km, Podul is carrying maximum sustained
Tropical Storm Podul strengthened into a typhoon at 8pm yesterday, the Central Weather Administration (CWA) said, with a sea warning to be issued late last night or early this morning. As of 8pm, the typhoon was 1,020km east of Oluanpi (鵝鑾鼻), Taiwan’s southernmost tip, moving west at 23kph. The storm carried maximum sustained winds of 119kph and gusts reaching 155kph, the CWA said. Based on the tropical storm’s trajectory, a land warning could be issued any time from midday today, it added. CWA forecaster Chang Chun-yao (張竣堯) said Podul is a fast-moving storm that is forecast to bring its heaviest rainfall and strongest
President William Lai (賴清德) yesterday criticized the nuclear energy referendum scheduled for Saturday next week, saying that holding the plebiscite before the government can conduct safety evaluations is a denial of the public’s right to make informed decisions. Lai, who is also the chairman of the Democratic Progressive Party (DPP), made the comments at the party’s Central Standing Committee meeting at its headquarters in Taipei. ‘NO’ “I will go to the ballot box on Saturday next week to cast a ‘no’ vote, as we all should do,” he said as he called on the public to reject the proposition to reactivate the decommissioned
TALKS CONTINUE: Although an agreement has not been reached with Washington, lowering the tariff from 32 percent to 20 percent is still progress, the vice premier said Taiwan would strive for a better US tariff rate in negotiations, with the goal being not just lowering the current 20-percent tariff rate, but also securing an exemption from tariff stacking, Vice Premier Cheng Li-chiun (鄭麗君) said yesterday. Cheng made the remarks at a news conference at the Executive Yuan explaining the new US tariffs and the government’s plans for supporting affected industries. US President Donald Trump on July 31 announced a new tariff rate of 20 percent on Taiwan’s exports to the US starting on Thursday last week, and the Office of Trade Negotiations on Friday confirmed that it
RSS