TSMC Arizona to Produce NVIDIA Blackwell GPUs in 2025

Sources indicate that TSMC has made significant progress with its Arizona-based wafer fabrication plant, as NVIDIA is reportedly negotiating to have its cutting-edge Blackwell GPUs manufactured there starting in 2025. If confirmed, this would mark a crucial milestone, with TSMC's Arizona plant utilizing its 4nm process node to produce NVIDIA's advanced GPUs.

The timing aligns with TSMC's plans for its Arizona facility, which is set to begin mass production of 4nm chips in the first half of 2025, closely coinciding with the ramp-up of NVIDIA's Blackwell GPU production. This development follows the U.S. Department of Commerce's approval in mid-November for a funding agreement under the CHIPS and Science Act. This agreement secures up to $6.6 billion in direct subsidies and $5 billion in loans to support TSMC's $65 billion investment in three advanced semiconductor fabs in Arizona. The first of these fabs, primarily focused on producing 5nm and 4nm processes, is expected to begin operations in 2025, with the other two facilities planned for 2028 and 2030.

Although TSMC's Arizona fab is on track to win the Blackwell GPU production contract, packaging remains a significant challenge. TSMC's CoWoS (Chip-on-Wafer-on-Substrate) advanced packaging capacity is seen as a key bottleneck for Blackwell's production. However, industry sources suggest that TSMC could transport the Blackwell GPUs to Taiwan for packaging, in line with its established supply chain processes. Additionally, it is rumored that Apple and AMD have also signed agreements with TSMC to manufacture chips at its Arizona facility.

Notably, in early October, TSMC and semiconductor packaging giant Amkor Technology announced a partnership to provide advanced packaging services in Arizona, including CoWoS and InFO (Integrated Fan-Out) packaging. This collaboration will further strengthen the semiconductor ecosystem in the region. Amkor is also investing $2 billion to build an advanced packaging plant in Arizona, with Apple expected to be a major customer. Once Amkor's packaging facility is operational, TSMC could leverage this plant to handle packaging for NVIDIA's chips produced in Arizona.

In the meantime, TSMC is expanding its CoWoS packaging capacity in Taiwan to meet the growing demand for AI chips. However, reports from Taiwan suggest that TSMC has declined NVIDIA CEO Jensen Huang's request to establish a dedicated packaging line for NVIDIA's AI products, indicating the complexities involved in scaling production capacity.