2nm Demand Surge, TSMC 2025 Capex to Hit $36B

According to a report from Taiwan's Economic Daily News, recent industry speculation suggests that TSMC is significantly enhancing its efforts in cutting-edge processes such as 2nm and expanding production capacity. Expected capital expenditures for 2025 are projected to increase by 12.5% to 14.3% year-over-year, ranging between $32 billion and $36 billion, marking one of the highest levels in its history.

Reports indicate robust demand from TSMC's 2nm customer base, surpassing expectations and prompting plans for capacity expansions, potentially including upgrades at the Nanke facility. Alongside Apple, an early adopter of TSMC's initial 2nm capacity, other clients are actively preparing to leverage this technology, driven by advancements in AI.

TSMC continues to advance towards its goal of commencing 2nm mass production in 2025, with ongoing progress at its Hsinchu Fab 15 Phase 4 and plans for expansion at Kaohsiung Fab 2. Potential developments at the Nanke facility could see TSMC's 2nm production capacity expand to eight fabs by late 2026.

In response to market speculation, TSMC has refrained from commenting, emphasizing that details regarding capital expenditures and 2nm progress will be shared primarily during their annual investor conference in April. During this event, TSMC reiterated its strategy of aligning capital expenditures and capacity planning with long-term market demand. They anticipate 2024 capital expenditures to range between $28 billion and $32 billion, with 2nm production expected to mirror the trajectory of its 3nm counterpart.

Following this year's shareholder meeting, TSMC Chairman Mark Liu addressed the media, highlighting the successful completion of their previous $100 billion investment plan over three years, attributing optimism about TSMC's future to the burgeoning AI sector.