TSMC’s Journey Amid Challenges: An Overview of The Chip Manufacturer’s Annual Performance

This article was last updated on January 18, 2024

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The Journey of TSMC Amid Unseen Challenges

Taiwan Semiconductor Manufacturing Company Limited (TSMC), the eminent chip manufacturer from Taiwan, has experienced what it calls a “challenging” 2022. With lower annual profits and turnover compared to the previous year, this period characterises a dip in the sector. However, displaying its resilience, TSMC found a way to ascend towards recovery in the latter part of the year. The annual turnover chalked up to 63 billion euros, while the profit was recorded at 23 billion euros. Despite this drop, the company remains hopeful and anticipates a surge in demand this year which may lead to a boost in the turnover. However, the conundrum lies in whether it can potentially rival the record-breaking year of 2022.

TSMC: A Pioneering Force in the Chip Manufacturing World

TSMC undeniably holds a pivotal position in the global chip manufacturing landscape. Working on a make-to-order basis, TSMC proudly supports the operations of some of the most renowned tech companies in the world. This list includes giants like Apple and the video card manufacturer Nvidia, thus attesting to TSMC’s leadership in the industry. The fiscal reports disclosed by TSMC indicate a noteworthy trend. The demand for the moat advanced chips, specifically the 3 nanometers, has experienced a near-tripled increase. The demand uptick originates from data centers and smartphone manufacturers like Apple, which are utilizing these chips for Artificial Intelligence (AI) applications. While TSMC’s production hub has traditionally been in Taiwan, geographical expansion is now part of its strategic roadmap. The company has been venturing into manufacturing centres across continents. With factories in various stages of setup in Japan, the United States, and Europe (Germany), TSMC is enhancing its global footprint. However, it still safeguards its most sophisticated technology.

TSMC’s Reliance on ASML for Advantaged Chip Manufacturing

TSMC’s ability to manufacture advanced chips relies significantly on ASML, a Netherlands-based chip machinery maker. Being the supplier of critical components for innovative chips, ASML plays an integral role in TSMC’s production process. The annual figures of ASML, an essential player in TSMC’s journey, are to be released next week, thereby escalating the anticipation in the industry.