TSMC Just Flexed Its Cash and Raised the Stakes in America After Record AI-Driven Earnings

Taiwan Semiconductor Manufacturing (TSM) is significantly increasing its business in America. The company has announced investing another $100 billion to expand its chipmaking in the U.S., on top of what it had already committed. Initially, TSMC pledged $65 billion for its Arizona plants under the Biden administration. In 2025, the amount was raised to $165 billion as the Trump team renegotiated the earlier chip deals. The additional spending plans now take the total U.S. investment to $265 billion. The investment will pay for four more advanced factories, bringing its U.S. total to 12 semiconductor and packaging facilities. The move is tied to a wider trade agreement between Washington and Taipei. U.S. Secretary of Commerce Howard Lutnick called it a historic deal, expecting the agreement to create tens of thousands of jobs in America. In late 2024, TSMC started creating its 4-nanometer chips in the U.S. By the second half of 2027, it expects to start manufacturing its more advanced 3-nanometer chips.

The timing lines up with a strong moment for the company. On the same day as this expansion was announced, the company posted record second-quarter results. The revenue for the company increased considerably, while the net profit was also reported at an all-time high. The vast majority of this growth came from TSMC’s AI chips, which now make up two-thirds of its business. TSMC manufactures nearly all the world’s most advanced AI chips, from Nvidia’s (NVDA) to those designed by Amazon (AMZN) and Alphabet's (GOOG) (GOOGL) Google. This is why it can keep spending at this scale. It's because the demand for AI chips is still running ahead of what the company can supply.