TSMC approves $45b budget for chip manufacturing expansion

Taiwan Semiconductor Manufacturing Co (TSMC) has approved a US$44.96 billion budget to expand its advanced and specialty chip manufacturing, including new fab construction and equipment upgrades.

The funding supports the company’s long-term technology plans and rising global demand, especially for AI applications.

TSMC’s board approved record-high profit-sharing and performance bonuses totaling NT$206.2 billion (US$6.5 billion) for 2025, a 46.6% increase from 2024.

The NT$103.1 billion (US$3.3 billion) performance bonuses were distributed quarterly during 2025, while profit sharing of the same amount will be paid in July 2026.

As of late 2025, TSMC employed about 78,000 staff in Taiwan, with average payouts over NT$2.64 million (US$82,500) per person.

The 2025 financial report shows revenue of NT$3.81 trillion (US$120.7 billion), net income of NT$1.72 trillion (US$54.5 billion), and a NT$6.0 (US$0.19) per share dividend for Q4.

CEO C.C. Wei said TSMC plans to upgrade its second Kumamoto fab to 3-nanometer chips to meet AI demand.

🔗 Source: Focus Taiwan

🧠 Food for thought

Implications, context, and why it matters.

The US$45 billion budget is separate from TSMC’s 2026 capex plan

TSMC approved a US$45 billion budget, while also planning US$52 billion to US$56 billion in 2026 capital expenditure (capex, or spending on factories and equipment) 1.
The 2026 capex range equals a 27% to 37% jump from the US$40.9 billion spent in 2025, as TSMC works to meet what it called “insatiable” demand for AI applications 1.
Employee bonuses rose 46.6% in 2025, closely matching the 46.4% increase in net profit that year 1.
AI-related demand fueled results as high-performance computing (HPC, a category that includes data-center chips used to train and run AI models) revenue climbed 48% year-over-year in 2025 2.

TSMC’s expansion signals ongoing AI supply strain and a changing chip map

TSMC’s capex plan keeps pressure on capacity for AI chips and advanced packaging (the specialized process of integrating multiple chips into a single high-performance package) as it ramps leading-edge production 1.
TSMC expects a healthier balance between supply and demand in 2028 or 2029, so the gap may last until then 1.
Overseas growth includes a previously announced US$165 billion total U.S. investment commitment for Arizona facilities, plus its position as a leading chip supplier to Nvidia and Apple 3.
Commerce Secretary Howard Lutnick told CNBC that U.S. policy aims to bring 40% of Taiwan’s semiconductor supply chain to the U.S., while analysts cited by CNBC questioned feasibility and cited Taiwan’s policies that keep leading-edge technology at home 3.