TSMC to invest $2.9 billion in advanced chip packaging plant in Taiwan
TSMC is the top producer of the world’s most advanced processors, including the chips found in the latest iPhones, iPads and Macs.
Jakub Porzycki | Nurphoto | Getty Images
Taiwan Semiconductor Manufacturing Company plans to invest nearly $90 billion New Taiwan dollars (about $2.87 billion) in an advanced chip packaging plant in Taiwan, the company told CNBC on Tuesday.
It comes as global chipmakers seek to capitalize on the artificial intelligence boom. TSMC acknowledged last week that there is a strong demand for AI chips.
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TSMC is the top producer of the world’s most advanced processors, which include chips found in the latest iPhones, iPads and Macs.
The investment was sparked by “the rapid growth of the AI market” which has “driven a surge in demand for TSMC’s advanced packaging,” according to a report from Taiwan’s official Central News Agency.
The facility will be located in Tongluo Science Park in northern Taiwan, TSMC said, adding the investment is expected to create about 1,500 local jobs.
“For AI, right now, we see a very strong demand. For the front-end part, we don’t have any problem to support,” said TSMC’s CEO C. C. Wei during the firm’s second quarter earnings report last week.
However, on the advanced packaging side, Wei said TSMC is experiencing “some very tight capacity.”
“We are increasing our capacity as quickly as possible and we expect that these tightenings will be released next year, but in between, we’re still working closely with our customers to support their growth,” he said Thursday.
Packaging is one of the final stages of semiconductor production. It involves putting chips into a protective case and creating the connections for it to be put into an electronics device.
The Central News Agency reported that TSMC’s packaging production capacity “is in short supply” as Nvidia and AMD compete for capacity. U.S.-based chip giants Nvidia and AMD are two of TSMC’s largest clients.
TSMC’s share performance
Nvidia buys high bandwidth memory chips that fit onto its latest A100 graphics processing units that train OpenAI’s chatbot ChatGPT.
ChatGPT, an AI-powered language model, went viral for its ability to generate humanlike responses to users’ prompts.
“As TSMC launches its advanced packaging expansion plan, the market is optimistic that Wanrun, Hongsu and Xinyun will benefit from the operation of equipment factories,” the report said, referring to companies that manufacture chip-related equipment.
TSMC shares rose 1.97% on Tuesday in Asia.
Firefly’s CEO Jason Kim reacts during the company’s IPO at the Nasdaq MarketSite in New York City, U.S., August 7, 2025.
Jeenah Moon | Reuters
Last week’s liftoff also coincided with President Donald Trump‘s “space superiority” executive order, signed on Friday, that aims to create a permanent U.S. base on the moon.
Investors have also gained more clarity on the future of NASA following a whirlwind drama since Trump won the election.
Last week, the Senate confirmed Jared Isaacman as NASA administrator more than a year after he was first nominated to the position.
Trump withdrew the nomination from the Elon Musk ally earlier this year amid a public fallout, but renominated Isaacman in November.
Transportation Secretary Sean Duffy was tapped to temporarily run the space agency in the interim.
Google parent Alphabet on Monday announced it will acquire Intersect, a data center and energy infrastructure company, for $4.75 billion in cash in addition to the assumption of debt.
Alphabet said Intersect’s operations will remain independent, but that the acquisition will help bring more data center and generation capacity online faster.
In recent years, Google has been embroiled in a fierce competition with artificial intelligence rivals, namely OpenAI, which kick-started the generative AI boom with the launch of its ChatGPT chatbot in 2022. OpenAI has made more than $1.4 trillion of infrastructure commitments to build out the data centers it needs to meet growing demand for its technology.
With its acquisition of Intersect, Google is looking to keep up.
“Intersect will help us expand capacity, operate more nimbly in building new power generation in lockstep with new data center load, and reimagine energy solutions to drive US innovation and leadership,” Sundar Pichai, CEO of Google and Alphabet, said in a statement.
Google already had a minority stake in Intersect from a funding round that was announced last December. In a release at the time, Intersect said its strategic partnership with Google and TPG Rise Climate aimed to develop gigawatts of data center capacity across the U.S., including a $20 billion investment in renewable power infrastructure by the end of the decade.
Alphabet said Monday that Intersect will work closely with Google’s technical infrastructure team, including on the companies’ co-located power site and data center in Haskell County, Texas. Google previously announced a $40 billion investment in Texas through 2027, which includes new data center campuses in the state’s Haskell and Armstrong counties.
Intersect’s operating and in-development assets in California and its existing operating assets in Texas are not part of the acquisition, Alphabet said. Intersect’s existing investors including TPG Rise Climate, Climate Adaptive Infrastructure and Greenbelt Capital Partners will support those assets, and they will continue to operate as an independent company.
Alphabet’s acquisition of Intersect is expected to close in the first half of 2026, but it is still subject to customary closing conditions.
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