AMD Looking To Procure Chips From TSMC’s U.S. Fab – Report

Ramish Zafar
AMD chief and board chair Dr. Lisa Su. Image: Lisa Su/Twitter

This is not investment advice. The author has no position in any of the stocks mentioned. has a disclosure and ethics policy.

The Taiwan Semiconductor Manufacturing Company's (TSMC) new chipmaking facility in Arizona will make the first deliveries to the Cupertino, California consumer technology giant Apple, Inc, according to a fresh report that has surfaced today. TSMC is building a new plant in Arizona and is slated to enter production in 2024. The report comes courtesy of the Nikkei Asian Review, which shares that TSMC"s first two customers will be NVIDIA and Apple, with other firms also interested in the plant.

Apple & NVIDIA Will Be TSMC's First U.S. Fab Customers Believes Report

According to The Review, while Apple and NVIDIA are locked in as TSMC's first customers for the Arizona facility, the company is also in talks with AMD and its subsidiary Xilinx to supply them with the necessary products from the American fab. Currently, TSMC's official statements have limited production from the fab to 5-nanometer products, but the company's founder Dr. Morris Chang, believes that 3-nanometer will also be available. Dr. Chang's statements are also bolstered by rumors of a planned expansion, which was recently reported by Bloomberg and had been making rounds in the rumor mill since March last year.

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Back then, a report allegedly tracing its way back to TSMC's employees had outlined that a planned expansion for the Arizona plant was also on the cards. While it had shied away from mentioning the technological details, it outlined that TSMC is planning to build six factories in Arizona for a combined investment of $35 billion and churn out 100,000 wafers per month. Right now, the fab is aiming to spend $12 billion with a production capacity of 20,000 wafers per month.

TSMC's chairman Dr. Mark Liu also shared his thoughts about a rumored expansion at an earnings call in 2021. At the event, he stated that any planned capacity expansion will depend on customer interest. Companies like TSMC have to make substantial capital investments for setting up new facilities, and these plans only materialize once they are certain that the demand for their products is in place.

TSMC's render of its Arizona fab shared during its tech symposium in 2020. Image: Taiwan Semiconductor Manufacturing Company

The company is set to hold a ceremony at the Arizona plant tomorrow to celebrate the first machines making their way into the plant. Nikkei's report also shares details of the purported expansion, outlining that the new plan will see the company produce 20,000 additional 3-nanometer wafers a month.

Demand for its latest chips is generally scooped up by Apple, which uses them first in its smartphones and then for other products. However, as the production technology matures, the semiconductors can be built to handle more strenuous computing requirements, such as those for desktop processors and data center equipment. This results in firms such as AMD and NVIDIA taking over from Apple as the Cupertino firm sets its sights on newer technologies.

Right now, TSMC is ramping up the production of its first generation 3-nanometer node, with advanced versions expected to hit the production lines sometime next year. However, it remains unclear whether the first generation or the newer ones will be built in Arizona, and this choice will also likely be influenced by the orders that TSMC receives from its customers.

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