TSMC says it will add $100 billion to Arizona chip investment

Taiwanese chipmaker TSMC said it will invest an additional $100 billion in Arizona as it reported record quarterly net profit driven by demand for artificial intelligence hardware.

TSMC is the largest contract maker of microchips used in products including Apple phones and Nvidia processors. The report said the company has benefited from the global race to develop AI, as governments and technology companies spend heavily on data centres that can train and run chatbots, image generators and task-executing agents. That spending has increased demand for chips, contributing to shortages and higher prices.

Chairman CC Wei told an earnings call that the AI trend continued to drive demand for more computing power. He said TSMC now expects full-year 2026 revenue growth to be slightly above 40% year-on-year in US dollar terms.

TSMC reported that net profit for April to June rose 77.4% from a year earlier to NT$706.6 billion, or $22 billion. That was above analyst estimates of NT$624.4 billion and higher than the company's previous quarterly record of NT$572.48 billion in the first quarter of 2026. The company said quarterly revenue rose 36% to NT$1.3 trillion.

Wei said TSMC was moving as quickly as possible to expand chipmaking capacity in Taiwan, Japan and the United States because customer demand was much higher than supply.

The company said the additional $100 billion for Arizona would bring its total planned investment in the United States to $265 billion. Wei said the money would be used to build several or more semiconductor logic wafer fabs for 2-nanometer and smaller technologies, as well as advanced packaging fabs.

Chief financial officer Wendell Huang said TSMC would increase its 2026 capital expenditure budget to between $60 billion and $64 billion as it continues to invest to support customer growth. Huang said higher capital expenditure at TSMC is linked to higher growth opportunities in later years, and said the company did not expect bottlenecks in its capacity expansion plan.

Counterpoint Research senior analyst William Li said before the results that TSMC's revenue growth showed AI infrastructure investment remained very strong despite macroeconomic uncertainty. He said demand for AI GPUs, AI ASICs and advanced packaging continued to exceed expectations, while constraints in EUV lithography tools and overseas fab investment could limit capacity expansion and weigh on margins in the near term.

The report said concerns about high technology valuations have raised fears of a market bubble and questions about when large AI spending will produce returns. Omdia principal analyst Simon Chen said those fears were overstated, saying demand was structural and backed by large capital expenditure from hyperscalers.