Taiwan Semiconductor Manufacturing Co (TSM) is in talks with Arizona authorities to enhance its advanced chip packaging capacity in the state, according to Governor Katie Hobbs.
This move comes as semiconductor packaging poses challenges and bottlenecks in production, especially for high-demand products like Nvidia Corp’s (NVDA) AI accelerators.
While TSMC has plans to expand packaging capacity in Taiwan, supply constraints are expected to persist for another 18 months.
As part of its commitment to Arizona, TSMC will establish two fabs and make a $40 billion investment, with the goal of producing more advanced 4-nm chips at the Arizona facility.
Packaging has become a crucial battleground for countries aiming to assert their technology leadership.
TSMC’s decision to offer advanced 4-nm chips from its Arizona plant highlights its strategic partnership with major customers such as Apple Inc (AAPL).
TSMC holds the highest number of advanced packaging patents with 2,946 and is ranked highest in quality based on citation frequency, according to LexisNexis.
Recent reports indicate that TSMC has asked major suppliers to delay the delivery of high-end chipmaking equipment due to delays at its $40 billion chip factory in Arizona, reflecting concerns about customer demand and its potential impact on semiconductor stocks.
Price Action: TSM shares closed higher by 0.19% at $89.00 on Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.