TSMC raises $1.5T chip forecast

Taiwan Semiconductor Manufacturing Co. said on May 14 that the global semiconductor market will exceed $1.5 trillion by 2030, raising its prior $1 trillion forecast as artificial intelligence demand reshapes where chip spending is going. The projection was laid out in materials for the company’s 2026 Taiwan Technology Symposium in Hsinchu. (finance.yahoo.com) TSMC said AI and high-performance computing would account for 55% of that 2030 market, ahead of smartphones at 20% and automotive at 10%. The company paired that market call with new details on 2-nanometer production, CoWoS packaging and fab construction plans. (taipeitimes.com) (focustaiwan.tw) ### Why did TSMC raise the 2030 market forecast? TSMC said AI demand is now large enough to push the semiconductor market past a threshold it had not projected before. The company told investors and customers that global semiconductor revenue should exceed $1 trillion this year and reach $1.5 trillion in 2030. Kevin Zhang, TSMC’s deputy co-chief operating officer, said at the Hsinchu symposium that “we are still at the beginning of the AI revolution,” according to Taipei Times. Zhang said AI would carry semiconductor growth into the next decade, and company data showed AI inference is expected to overtake AI training as the main growth driver by 2030. (finance.yahoo.com) ### Which parts of the chip market does TSMC say will dominate? TSMC said AI and high-performance computing will make up 55% of the 2030 semiconductor market. Smartphones are expected to account for 20%, while automotive applications are projected at 10%, according to the company’s presentation materials reported by Reuters. (taipeitimes.com) The company also said AI accelerator wafer demand is projected to rise 11-fold from 2022 to 2026. That demand profile helps explain why TSMC’s latest update focused as much on packaging and system integration as on transistor scaling. (taipeitimes.com) ### What exactly is TSMC expanding in 2nm and packaging? B.Z. Tien, TSMC vice president for operations and advanced technology engineering, said the company plans to launch five new fabs in 2026 to meet demand for AI and 2nm chips. Focus Taiwan reported that Tien said A16 remains on track for production in the second half of 2026. (finance.yahoo.com) TSMC said capacity for its 2nm and A16 technologies is projected to grow at a 70% compound annual rate from 2026 to 2028. The company also said CoWoS capacity is forecast to grow by more than 80% from 2022 to 2027, while Taipei Times reported TSMC described CoWoS growth at a 90% compound annual rate from 2022 to next year. Both accounts point to a rapid increase in advanced packaging output. (finance.yahoo.com) ### What did TSMC say about CoWoS and SoIC performance? Lipen Yuan, TSMC vice president for business development, said the company’s 5.5-reticle-size CoWoS technology has achieved yields above 98% and entered mass production this year. (focustaiwan.tw) Focus Taiwan said TSMC is planning a 14-reticle-size CoWoS platform in 2028 that can integrate 20 high-bandwidth memory chips, followed by a 24-HBM version in 2029. TSMC’s symposium materials also highlighted 3DFabric technologies including TSMC-SoIC, InFO, CoWoS and TSMC-SoW. The company’s public symposium page said the event would cover “advanced silicon stacking and packaging” alongside progress on 3nm, 2nm, A16 and A14 processes. (finance.yahoo.com) ### Where is the company adding capacity outside Taiwan? TSMC said its first Arizona fab is already in production, with tool move-in for a second fab planned in the second half of 2026. Construction of a third Arizona fab is under way, and work on a fourth fab and the site’s first advanced packaging facility is expected to begin this year. The company said Arizona output in 2026 should be 1.8 times the prior year, with yields comparable to Taiwan. (focustaiwan.tw) In Japan, TSMC said the first fab is in volume production for 22nm and 28nm products, while plans for a second fab were upgraded to 3nm because of demand. (tsmc.com) In Germany, the company said its fab remains under construction and is scheduled to provide 28nm and 22nm technologies first, followed by 16nm and 12nm. ### What comes next? The second half of 2026 is the next dated milestone in TSMC’s update, with A16 production and Arizona second-fab tool move-in both scheduled in that period. The company also said work on a fourth Arizona fab and the first Arizona advanced packaging facility should begin this year, while larger CoWoS platforms are targeted for 2028 and 2029. (finance.yahoo.com) (focustaiwan.tw)