TSMC
Taiwan Semiconductor Manufacturing Company Limited is a Taiwanese multinational semiconductor contract manufacturing and design company. It is the world's largest dedicated contract chipmaker, the largest manufacturer of advanced artificial intelligence chips, and a key supplier of Nvidia, Apple, Broadcom, and Qualcomm. It is one of the world's most valuable semiconductor companies, and Taiwan's largest company, with headquarters and main operations located in the Hsinchu Science Park in Hsinchu, Taiwan. Although the government of Taiwan is the largest individual shareholder, the majority of TSMC is owned by foreign investors. In 2025, the company was ranked 38th in the Forbes Global 2000. Taiwan's exports of integrated circuits amounted to $184 billion in 2022, nearly 25 percent of Taiwan's GDP. TSMC constitutes about 30 percent of the Taiwan Stock Exchange's main index.
Taiwan Semiconductor Manufacturing Company was established in 1987 as a joint venture between Taiwan’s government, the Industrial Technology Research Institute, and private investors. Morris Chang founded the company to commercialize semiconductor research originally developed at ITRI, becoming the world’s first dedicated semiconductor foundry. When Chang retired in 2018, after 31 years of TSMC leadership, Mark Liu became chairman and C. C. Wei became Chief Executive. It has been listed on the Taiwan Stock Exchange since 1993; in 1997 it became the first Taiwanese company to be listed on the New York Stock Exchange. Since 1994, TSMC has had a compound annual growth rate of 17.4 percent in revenue and a CAGR of 16.1 percent in earnings.
Most fabless semiconductor companies such as AMD, Apple, ARM, Broadcom, Marvell, MediaTek, Qualcomm, and Nvidia are customers of TSMC, as are emerging companies such as Allwinner Technology, HiSilicon, Spectra7, and UNISOC. Programmable logic device companies Xilinx and previously Altera also make or made use of TSMC's foundry services. Some integrated device manufacturers that have their own fabrication facilities, such as Intel, NXP, STMicroelectronics, and Texas Instruments, outsource some of their production to TSMC.
TSMC has a global capacity of about thirteen million 300 mm-equivalent wafers per year as of 2020 and produces chips for customers with process nodes from 2 microns to 3 nanometres. TSMC was the first foundry to market 7-nanometre and 5-nanometre production capabilities, and the first to commercialize ASML's extreme ultraviolet lithography technology in high volume.
History
In 1986, Li Kwoh-ting, representing the Executive Yuan, invited Morris Chang to serve as the president of the Industrial Technology Research Institute and offered him a blank check to build Taiwan's chip industry. At that time, the Taiwanese government wanted to develop its semiconductor industry, but its high investment and high risk nature made it difficult to find investors. Texas Instruments and Intel turned down Chang. Only Philips was willing to sign a joint venture contract with Taiwan to put up $58 million, transfer its production technology, and license intellectual property in exchange for a 27.6 percent stake in TSMC. Alongside generous tax benefits, the Taiwanese government, through the National Development Fund, Executive Yuan, provided another 48.3 percent of the startup capital for TSMC. 20% of the capital was raised from eight private companies which were owned by some of the island's wealthiest families, who owned firms that specialized in plastics, textiles, and chemicals. These wealthy Taiwanese were directly "asked" by the government to invest. The rest of the 4.1% capital came from Taiwan's then ruling party’s investment arm: Kuomintang Central Investment Co.From the company's onset, TSMC operated primarily as a project of the Taiwanese state, as opposed to a completely private company. Its first CEO was James E. Dykes, who left after a year and Morris Chang became the CEO. Although Philips initially held a 27.5% stake in TSMC, its influence extended beyond financial investment. In addition to capital, Philips played a crucial role by transferring semiconductor manufacturing technology, intellectual property, and patents to TSMC, enabling the company to scale more rapidly. Philips also provided TSMC's first CEO, James E. Dykes, who had previously worked at Philips North America. This partnership represented an early example of the “fab-light” strategy, as Philips gradually reduced its in-house semiconductor manufacturing and relied more on external foundries like TSMC. Over the following decades, Philips steadily divested its stake in TSMC and shifted its primary focus to healthcare technology.
Since then, the company has continued to grow, albeit subject to the cycles of demand. In 2011, the company planned to increase research and development expenditures by almost 39 percent to NT$50 billion to fend off growing competition. The company also planned to expand capacity by 30 percent in 2011 to meet strong market demand. In May 2014, TSMC's board of directors approved capital appropriations of US$568 million to increase and improve manufacturing capabilities after the company forecast higher than expected demand. In August 2014, TSMC's board of directors approved additional capital appropriations of US$3.05 billion.
In 2011, it was reported that TSMC had begun trial production of the A5 SoC and A6 SoCs for Apple's iPad and iPhone devices. According to reports, in May 2014 Apple sourced its A8 and A8X SoCs from TSMC. Apple then sourced the A9 SoC with both TSMC and Samsung and the A9X exclusively with TSMC, thus resolving the issue of sourcing a chip in two different microarchitecture sizes. As of 2014, Apple was TSMC's most important customer. In October 2014, ARM and TSMC announced a new multi-year agreement for the development of ARM based 10 nm FinFET processors.
Over the objection of the Tsai Ing-wen administration, in March 2017, TSMC invested US$3 billion in Nanjing to develop a manufacturing subsidiary there.
In 2020, TSMC became the first semiconductor company in the world to sign up for the RE100 initiative, pledging to use 100 percent renewable energy by 2050. TSMC accounts for roughly 5 percent of the energy consumption in Taiwan, even exceeding that of the capital city Taipei. This initiative was thus expected to accelerate the transformation to renewable energy in the country. For 2020, TSMC had a net income of US$17.60 billion on a consolidated revenue of US$45.51 billion, an increase of 57.5 percent and 31.4 percent respectively from the 2019 level of US$11.18 billion net income and US$34.63 billion consolidated revenue. Its market capitalization was over $550 billion in April 2021. TSMC's revenue in the first quarter of 2020 reached US$10 billion, while its market capitalization was US$254 billion. TSMC's market capitalization reached a value of NT$1.9 trillion in December 2010. It was ranked 70th in the FT Global 500 2013 list of the world's most highly valued companies with a capitalization of US$86.7 billion, while reaching US$110 billion in May 2014. In March 2017, TSMC's market capitalization surpassed that of semiconductor giant Intel for the first time, hitting NT$5.14 trillion, with Intel's at US$165.7 billion. On 27 June 2020, TSMC briefly became the world's 10th most valuable company, with a market capitalization of US$410 billion.
To mitigate business risks in the event of war between Taiwan and the People's Republic of China, since the beginning of the 2020s, TSMC has expanded its geographic operations, opening new fabs in Japan and the United States, with further plans for expansion into Germany. In July 2020, TSMC confirmed it would halt the shipment of silicon wafers to Chinese telecommunications equipment manufacturer Huawei and its subsidiary HiSilicon by 14 September. In November 2020, officials in Phoenix, Arizona in the United States approved TSMC's plan to build a $12 billion chip plant in the city. The decision to locate a plant in the US came after the Trump administration warned about the issues concerning the world's electronics made outside of the U.S. In 2021, news reports claimed that the facility might be tripled to roughly a $35 billion investment with six factories. See for more details.
In June 2021, following nearly a year of public controversy surrounding its COVID-19 vaccine shortage, with only about 10 percent of its 23.5 million population vaccinated; Taiwan agreed to allow TSMC and Foxconn to jointly negotiate purchasing COVID-19 vaccines on its behalf. In July 2021, BioNTech's Chinese sales agent Fosun Pharma announced that the two technology manufacturers had reached an agreement to purchase 10 million BioNTech COVID-19 vaccines from Germany. TSMC and Foxconn pledged to each buy five million doses for up to $175 million, for donation to Taiwan's vaccination program.
Due to the 2020–2023 global semiconductor shortage, Taiwanese competitor United Microelectronics raised prices approximately 7–9 percent, and prices for TSMC's more mature processors were raised by about 20 percent. In November 2021, TSMC and Sony announced that TSMC would be establishing a new subsidiary named Japan Advanced Semiconductor Manufacturing in Kumamoto, Japan. The subsidiary manufactures 22- and 28-nanometer processes. The initial investment was approximately $7 billion, with Sony investing approximately $500 million for a less than 20 percent stake. Construction of the fabrication plant started in 2022, with production beginning two years later in 2024.
In February 2022, TSMC, Sony Semiconductor Solutions, and Denso announced that Denso would take a more than 10 percent equity stake in JASM with a US$0.35 billion investment, amid a scarcity of chips for automobiles. TSMC will also enhance JASM's capabilities with 12/16 nanometer FinFET process technology in addition to the previously announced 22/28 nanometer process and increase monthly production capacity from 45,000 to 55,000 12-inch wafers. The total capital expenditure for JASM's Kumamoto fab is estimated to be approximately US$8.6 billion. The Japanese government wants JASM to supply essential chips to Japan's electronic device makers and auto companies as trade friction between the United States and China threatens to disrupt supply chains. The fab is expected to directly create about 1,700 high-tech professional jobs.
In July 2022, TSMC announced the company had posted a record profit in the second quarter, with net income up 76.4 percent year-over-year. The company saw steady growth in the automotive and data center sectors with some weakness in the consumer market. Some of the capital expenditures are projected to be pushed up to 2023. In the third quarter of 2022, Berkshire Hathaway disclosed purchase of 60 million shares in TSMC, acquiring a $4.1 billion stake, making it one of its largest holdings in a technology company. However, Berkshire sold off 86.2 percent of its stake by the next quarter citing geopolitical tensions as a factor. In February 2024, TSMC shares hit a record high, with the high on the trading day reaching NT$709 and closing at NT$697. This was influenced by the increase in the price target on chip designer Nvidia. TSMC currently manufactures 3-nanometer chips and plans to start 2-nanometer mass production in 2025. It is included in the FTSE4Good Index, being the only Asian company in the top ten.
In October 2024, TSMC informed the United States Department of Commerce about a potential breach of export controls in which one of its most advanced chips was sent to Huawei via another company with ties to the Chinese government.
In June 2025, TSMC announced the establishment of the TSMC-UTokyo Lab, marking its first joint research laboratory with an overseas university. In August 2025, TSMC reported that two current employees and six former employees had illegally acquired trade secrets related to the company's leading 2nm process. One of them went on to work for Tokyo Electron, a partner of Japan's semiconductor effort Rapidus, but has since been terminated. A number of suspects have been arrested by Taiwanese authorities.
In January 2026, reported a 35% increase in fourth-quarter profit. This is higher than previous estimates, hitting a fresh record as demand for artificial intelligence chips remained strong.