Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker, has acknowledged that rising global trade tariffs have had some impact on its operations, particularly in its supply chain and cost structure. However, the company emphasized that surging demand for AI-related semiconductors continues to underpin its robust business outlook.
During a recent investor briefing, TSMC executives confirmed that while trade tensions — notably between the United States and China — are creating additional challenges, they are not significantly dampening the company’s long-term growth prospects. The company reiterated its strategic focus on advanced process technologies, particularly in the AI and high-performance computing (HPC) sectors, where demand remains exceptionally strong.
“Yes, tariffs have had some impact on the cost and flow of materials,” said C.C. Wei, CEO of TSMC. “However, the structural demand for AI, from data centers to edge devices, continues to grow faster than we anticipated. We are ramping up production accordingly.”
Tariff Pressures and Mitigation Efforts
In recent years, global semiconductor supply chains have faced increased scrutiny and regulatory pressure. The U.S. government has implemented a series of export controls and tariffs targeting Chinese tech firms, while China has responded with its own trade measures. These policies have led to increased costs for raw materials and logistics, which TSMC says it is actively managing through regional diversification and long-term supplier agreements.
The company is also moving forward with its global expansion strategy. New fabrication plants under construction in Arizona, Japan, and Germany are part of TSMC’s plan to reduce geographic risk and meet the needs of key clients closer to their home markets.
AI Boom Fuels Revenue Optimism
Despite geopolitical and macroeconomic headwinds, TSMC’s AI-related chip orders — particularly those using its advanced 3nm and upcoming 2nm process nodes — are accelerating. The firm is a key manufacturer for major players in the AI space, including NVIDIA, AMD, and custom silicon providers for hyperscalers like Google, Amazon, and Microsoft.
Analysts note that AI workloads require specialized chips that TSMC is uniquely positioned to manufacture at scale. From GPUs to AI accelerators, the need for high-performance, energy-efficient chips has never been greater.
"TSMC’s exposure to AI gives it a long runway for growth,” said an industry analyst at a Taipei investment firm. “Even with tariffs and short-term supply disruptions, its technological lead in chip manufacturing is difficult to match.”
Looking Ahead
TSMC reaffirmed its full-year revenue forecast and expects continued strength in AI and HPC segments to offset softness in consumer electronics and traditional computing markets. The company is also investing heavily in research and development to maintain its edge in advanced packaging, chiplet integration, and EUV lithography.
“We remain committed to technological leadership and capacity expansion,” CEO Wei added. “Our focus on enabling AI innovation is stronger than ever.”
As global chipmakers navigate an increasingly complex geopolitical landscape, TSMC’s ability to ride the AI wave while managing external shocks will be critical to its sustained dominance in the semiconductor industry.