TSMC 3nm Capacity Hits 100%, 5nm Reaches 101%

According to Taiwan's Commercial Times, despite Apple lowering its chip tape-out forecast for iPhones in Q1 2024, TSMC's 3nm production capacity is expected to remain fully utilized in the first half of next year, driven by high demand for Qualcomm and MediaTek's flagship smartphone chips. Additionally, thanks to the growing AI chip market, TSMC's 5nm capacity utilization could reach 101% in the same period.

In another update from industry sources, NVIDIA's Blackwell GPU series is set to ramp up production, with approximately 200,000 B200 chips expected to be produced by the end of this year. In Q3 2024, NVIDIA is also set to release the B300A chip, responding to strong demand for AI chips. As for TSMC's advanced packaging CoWoS capacity, the company's monthly output is expected to reach 36,000 wafers by year-end, with projections to exceed 90,000 wafers per month by the end of 2024, following the ramp-up of new facilities.

TSMC's October financial results demonstrate a record-high revenue of NT$314.24 billion, reflecting a 24.8% increase from the previous quarter and a 29.2% year-over-year growth. This indicates that TSMC's production lines remain fully loaded despite the typical seasonal slowdown in consumer electronics, and AI demand is driving rapid growth. The effectiveness of TSMC's investments in 3nm technology is now becoming evident.

Looking ahead, TSMC is expected to increase its 3nm production capacity by transitioning more of its 5nm production to 3nm nodes. This strategy, combined with TSMC's technological leadership, will help the company expand its 3nm capacity even further.

The success of TSMC's 3nm technology also strengthens MediaTek's position with its flagship Dimensity chipsets. According to sources in the supply chain, Samsung's in-house chip production faces yield challenges, leading to an expected 15% shortfall in its smartphone chip supply next year. This creates an opportunity for MediaTek to expand its market share. Consequently, the 10% reduction in Apple's iPhone chip tape-out volume is unlikely to significantly impact TSMC's capacity utilization. With 3nm chips set to remain the dominant choice in smartphones next year, TSMC is poised to continue leading in this advanced process node.

In the 5nm segment, NVIDIA's Blackwell GPUs will further boost TSMC's production capacity, which is projected to reach 101% in the first half of 2024. Additionally, TSMC's Arizona wafer fab's Phase 1 expansion is expected to start volume production in early 2024. By the end of this year, around 200,000 Blackwell GPUs will be delivered, with production ramping up throughout 2024 to contribute significantly to TSMC's revenue. NVIDIA's roadmap includes the release of 3nm-based B300/B300A chips in Q3 2024, utilizing CoWoS-L and CoWoS-S advanced packaging.

To meet the rising demand for advanced packaging, TSMC's CoWoS capacity is set to reach 36,000 wafers per month by year-end, with plans to expand this to over 90,000 wafers per month by late 2024.