Major Clients Reportedly Fully Allocate TSMC’s Production Capacity Until 2026, 3nm Process in High Demand

The continuous increase in silicon content driven by AI servers, high-performance computing (HPC) applications, and the AI integration of high-end smartphones has led to a surge in demand for semiconductors. According to a report from the Economic Daily News, major companies such as Apple, Qualcomm, NVIDIA, and AMD are reportedly securing substantial production capacity for TSMC’s 3nm process family. This has resulted in a queue of clients stretching all the way to 2026.

TSMC has a consistent policy of not commenting on individual client information. Regarding whether the high demand for production capacity will lead to price increases to reflect its value, TSMC emphasizes that its pricing strategy is always strategically oriented rather than opportunistically driven. TSMC will continue to work closely with clients to provide value.

As per sources cited by the same report, TSMC is not a company that raises prices arbitrarily. Reflecting value does not equate directly to price increases, even though the company holds a leading edge in advanced process technology. There are various ways for TSMC to demonstrate value to its customers.

The members of TSMC’s 3nm family include N3, N3E, N3P, as well as N3X and N3A. As the existing N3 technology continues to be upgraded, N3E, which began mass production in the fourth quarter of last year, targets applications such as AI accelerators, high-end smartphones, and data centers. N3P is scheduled for mass production in the second half of this year and is expected to become mainstream for applications in mobile devices, consumer products, base stations, and networking through 2026. N3X and N3A are customized for high-performance computing and automotive clients.

Source: TSMC

Industry sources cited by Economic Daily News in the report believe that with clients rushing to book production capacity, TSMC’s 3nm family will continue to experience tight supply over the next two years. This does not yet include Intel’s outsourcing demand for CPUs.

Due to the fact that TSMC’s 3nm family production capacity has already been fully allocated by customers for this year and next, the company’s plan to triple the relevant capacity this year compared to last year is still insufficient. To ensure an uninterrupted supply for the next two years, TSMC has implemented several measures to expand its production capacity.

Previously, during an earnings call, the company announced that due to robust demand, its strategy includes converting some 5nm equipment to support 3nm production. Industry sources cited by the report also reveal that TSMC’s total 3nm family capacity is continuously increasing, with monthly production capacity expected to reach between 120,000 and 180,000 wafers.

Meanwhile, the sources cited by the Economic Daily News indicate that the main sources of orders for TSMC’s 3nm family include major clients such as Apple, Qualcomm, NVIDIA, and AMD. Apple is expected to launch the iPhone 16 series as early as September, which is anticipated to be the first iPhone with AI capabilities, potentially sparking a new wave of upgrades among Apple fans.

Source: TSMC