Apple, Nvidia Secure Future with Taiwan Semi's Advanced Chips as AI Demand Soars
Apple Inc (NASDAQ:AAPL), Qualcomm Inc (NASDAQ:QCOM), Nvidia Corp (NASDAQ:NVDA), and Advanced Micro Devices, Inc (NASDAQ:AMD) have almost fully booked Taiwan Semiconductor Manufacturing Company Ltd's (NYSE:TSM) 3nm chip production process until 2026, reflecting the artificial intelligence frenzy.
This demand spike reflects the rapid evolution of AI technology, pushing TSMC to innovate further in advanced manufacturing, TechNode reports.
N3E, which started mass production last quarter, targets AI accelerators, high-end smartphones, and data centers. N3P, scheduled for mass production later this year, will cater to mobile devices and consumer electronics. It will likely be the standard by 2026.
To accommodate the growing demand, TSMC plans to convert some 5nm equipment to enhance 3nm production capacity, potentially increasing 3nm wafer production to between 120,000 and 180,000 units monthly. TSMC stock is trading higher on Thursday.
The contract chipmaker remains engaged in expanding its geographical presence beyond Taiwan. Recent reports indicated that TSMC is looking to recruit 2,000 employees in Europe, coinciding with its plans to construct a Dresden wafer fab.
Also, TSMC has significantly beaten leading Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC), bagging a market share of 62% in the first quarter. It clocked a 30% sales growth in May, reaching $7.1 billion, as the intense demand for AI refuses to fizzle out anytime soon.
Taiwan Semiconductor stock gained 62% in the last 12 months. Investors can gain exposure to the semiconductor sector via First Trust Exchange-Traded Fund VIII First Trust Active Global Quality Income ETF (NYSE:AGQI) and First Trust S-Network Electric & Future Vehicle Ecosystem ETF (NASDAQ:CARZ).
Price Action: TSM shares were trading higher by 0.99% to $174.70 premarket at the last check on Thursday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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