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TSMC to Boost Capital Expenditures to Up to $36 Billion in 2025 Amid Strong Demand

Advanced 2nm Process Drives Anticipated Increase in TSMC’s Capital Spending
Taiwan
t 2330.TW Blue Chip 150 OM 60 Semicon 75 Tech 350
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TSMC, the world’s leading semiconductor manufacturer, is poised to significantly increase its capital expenditures in 2025, with industry sources projecting a budget between $32 billion and $36 billion. This surge is driven by robust demand and continued advancements in the company’s cutting-edge 2nm process technology.

At its April press conference, TSMC highlighted that its capital expenditures for 2024 are expected to range from $28 billion to $32 billion, with mass production of 2nm chips slated to begin in 2025. The company emphasized that its expenditure and capacity planning align with long-term market demand trends. Chairman Wei Zhejia affirmed that TSMC’s previous three-year, $100 billion investment plan concluded successfully last year, propelled by the burgeoning AI market.

Rumors suggest that TSMC’s 2nm customer demand is surpassing expectations, prompting potential capacity expansions across multiple locations in Taiwan, including Zhuke Baoshan, Kaohsiung, and potentially Nanke. These expansions aim to bolster TSMC’s 2nm production capabilities, supporting diverse applications beyond Apple, which has already secured the initial 2nm production batch.

Industry analysts predict that TSMC’s increased capital expenditures will benefit major equipment suppliers like ASML and Applied Materials, along with third-party manufacturers. Despite TSMC’s non-committal stance on market speculation, it maintains its focus on strategic investments and technological advancements.

Looking ahead, TSMC’s robust financial health, bolstered by its advanced 3nm and 5nm processes, is expected to support steady quarterly dividend increases. The company projects cash dividends to reach NT$24 by 2025, reflecting its sustained capital efficiency and market leadership.

As TSMC continues to innovate and expand its production capacities, the semiconductor giant is well-positioned to meet the escalating demands of the AI and tech industries, further solidifying its dominance in the global semiconductor market.

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