TSMC Reports Strong AI Demand Amid Tariff Concerns and Quashes Middle East Expansion Rumors

TSMC quashes UAE fab rumors, but says AI demand remains fierce in the face of tariff pressures

Just days after TSMC was reported to be in talks with Washington over a planned fab expansion in the Middle East, company CEO C.C. Wei has quashed those rumors at the company's annual shareholders meeting. As noted by Reuters' Wen-Yee Lee on X, Wei said the company had no plans to set up fabs in the Middle East. He also addressed the issue of tariff impact, but said that while TSMC had some exposure to waning demand, AI demand was consistently outpacing supply. Wei's comments on the Middle East follow a Bloomberg report that claimed TSMC was evaluating the possibility of opening a chip fab in the UAE. It was claimed TSMC had met with U.S. special envoy to the Middle East Steve Witkoff and a state-owned investment firm several times. The fab would have reportedly been the size of Fab 21 in Arizona. Concerns cited included national security, given the significant influence of China and Iran in the region, as well as talent drain from other locations required to build the plant. Turns out, those concerns were academic, with TMSC clearly having ruled out the possibility, at least for now. According to ComputerBase, Wei stated a UAE fab would not fit the company's strategy, given that there are no large clients in the local region. Reuters further reports that Wei addressed the impact of tariffs on the company, noting small but limited exposure he believes is likely to be offset by AI demand. "Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters," he said. "TSMC is an exporter. However, tariffs can lead to slightly higher prices, and when prices go up, demand may go down." Wei went on to say that TSMC's business could be affected if demand drops, but claimed AI demand "has always been very strong and it's consistently outpacing supply." A report in May claimed that tariffs could increase tech prices by up to 70% across the globe. As Wei notes, TSMC faces no immediate exposure because its chips are exported to manufacturers, which incorporate them into their products. However, import duties on those could stifle demand, which could have a knock-on effect on TSMC, a problem that could take months to show up on the chipmaker's bottom line. Despite Wei's assurances, the company did recently address the U.S. Commerce Department, following a call for public comments regarding tariffs on semiconductors arriving on U.S. shores. TSMC warned import duties on chips would significantly reduce demand for the electronic products sold by TSMC's customers, causing revenue decline and impacting investment on U.S. shores, notably its Arizona plant. "Lower market demand for our leading U.S. customers' products may consequently reduce demand for TSMC's manufacturing capacity and service onshore," the company said, warning diminished demand could create uncertainty around the timeline and operation of the Arizona fab. TSMC said "tariffs that raise the cost of end consumer products will lower demand for such products and the semiconductor components they contain" and called on the administration to avoid imposing any tariffs or restrictive measures on semiconductors made outside the U.S..

TSMC says tariffs have some impact but AI demand robust

HSINCHU, Taiwan, June 3 (Reuters) - U.S. tariffs are having some impact but demand for artificial intelligence (AI) remains strong and continues to outpace supply, the chief executive of Taiwanese chipmaker TSMC (2330.TW), opens new tab said on Tuesday. U.S. President Donald Trump's trade policies have created much uncertainty for the global chip industry and TSMC, the top producer of the world's most advanced semiconductors whose customers include Apple (AAPL.O), opens new tab and Nvidia (NVDA.O), opens new tab. C.C. Wei, speaking at the company's annual shareholders meeting in the northern Taiwanese city of Hsinchu, said they have not seen any changes in customer behaviour due to tariff uncertainty and the situation may become clearer in coming months. "Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters. TSMC is an exporter. However, tariffs can lead to slightly higher prices, and when prices go up, demand may go down," he said. "If demand drops, TSMC's business could be affected. But I can assure you that AI demand has always been very strong and it's consistently outpacing supply." In April, the company, the world's largest contract chipmaker, gave a bullish outlook for the year on robust demand for AI applications. Reporting by Wen-Yee Lee; Writing by Ben Blanchard; Editing by Christian Schmollinger and Edwina Gibbs Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Artificial IntelligenceClean Energy

TSMC forecasts record profit in 2025 on soaring AI demand

Taiwanese chip titan TSMC said Tuesday that it expected to see record earnings this year as it increased semiconductor production capacity to meet soaring demand for AI technology. Taiwan Semiconductor Manufacturing Company is the world's largest contract chipmaker and counts Nvidia and Apple among its clients. While US tariffs have had "some" indirect impact on the firm, chairman and chief executive CC Wei said the artificial intelligence business would remain "very strong." "Our revenue and profit this year will set new historical highs," he told the company's annual shareholders meeting. With AI demand "very high," the company was trying to "increase production capacity to satisfy our customers," Wei said. But he denied reports that the company was planning to build factories in the Middle East. TSMC has been under pressure for years to move more of its production away from Taiwan, where the bulk of its fabrication plants are located, amid worries about China. Beijing claims the island is part of its territory and has threatened to use force to bring it under its control. The chip firm has in recent years broken ground for plants in the United States, Europe and Japan. Bloomberg News, citing unnamed sources, reported last week that it was considering building an advanced facility in the United Arab Emirates. "I think rumors are really flying everywhere," Wei said. TSMC last month reported sales of NT$349.6 billion (US$11.6 billion) for April, a rise of 48.1% from a year earlier and up 22.2% from March. The surge came after US President Donald Trump's global tariff blitz spurred companies to stock up, owing to fears that higher levies were in the pipeline. Wei told shareholders that TSMC's business "may be affected" if tariffs force up prices and demand for chips falls, but he added, "Our business will still be very good." "I am not afraid of anything, I am only afraid that the world economy will decline," he added. TSMC has been in the crosshairs of Trump, who has accused Taiwan of stealing the US chip industry. There had been hopes TSMC's plan to invest an additional US$100 billion in the United States would shield Taiwan from new tariffs. Trump still imposed a 32% duty on imports from the island as part of his sweeping tariffs -- which were later paused for 90 days -- but excluded semiconductors. Washington has launched "national security" probes into the sector, which could pave the way for levies on chips and chipmaking equipment.

TSMC Says US Tariffs Have Some Impact But AI Demand Robust

Taiwan's TSMC said on Tuesday that US tariffs were having some impact on the company and had been discussed with Washington, but demand for artificial intelligence (AI) remains strong and continues to outpace supply. US President Donald Trump's trade policies have created much uncertainty for the global chip industry and TSMC, the top producer of the world's most advanced semiconductors whose customers include Apple and Nvidia. Chief Executive C.C. Wei, speaking at TSMC's annual shareholders meeting in the northern Taiwanese city of Hsinchu, said the company had not seen any changes in customer behaviour due to tariff uncertainty and the situation might become clearer in coming months. "Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters. TSMC is an exporter. However, tariffs can lead to slightly higher prices, and when prices go up, demand may go down," he said. "If demand drops, TSMC's business could be affected. But I can assure you that AI demand has always been very strong and it's consistently outpacing supply." In April, the company, the world's largest contract chipmaker, gave a bullish outlook for the year on robust demand for AI applications. Wei said TSMC had been talking to the US Department of Commerce about tariffs, expressing concern early on that the levies could increase production costs in the country where it is investing $165 billion (roughly Rs. 14,10,082 crore) to build new factories, as some equipment purchased from US suppliers is made in Asia. "The US commerce department said this is open for discussion, but how long that will take remains unclear," he added. "The real point is that we are in active communication, because only through understanding can they realise the consequences." Wei said he had told Trump the extra $100 billion (roughly Rs. 8,54,595 crore) investment, which he announced standing next to the president in March, would be difficult to complete within five years. "He said, 'Mr Wei, do your best, that's good enough.'" Asked about media reports that the company had been looking at building chip factories in the United Arab Emirates, Wei said TSMC had no plans for any such plants in the Middle East because it was "not very likely" they would have customers there. Domestically, TSMC's margins are being pressured by the recent appreciation of the Taiwan dollar, which Wei said had reduced its gross margin by more than three percentage points. TSMC also faces broader political risk as China steps up military pressure on democratically and separately governed Taiwan, which Beijing views as "sacred" Chinese territory. "If something happens that we don't want to happen, it's a matter for governments, not for TSMC alone," Wei said, responding to a question about a possible crisis in the Taiwan Strait. © Thomson Reuters 2025

Tariffs have some impact, but AI demand still outpaces supply: TSMC CEO

US tariffs are having some impact but demand for artificial intelligence (AI) remains strong and continues to outpace supply, the chief executive of Taiwanese chipmaker TSMC said on Tuesday. US President Donald Trump's trade policies have created much uncertainty for the global chip industry and TSMC, the top producer of the world's most advanced semiconductors whose customers include Apple and Nvidia. C.C. Wei, speaking at the company's annual shareholders meeting in the northern Taiwanese city of Hsinchu, said they have not seen any changes in customer behaviour due to tariff uncertainty and the situation may become clearer in coming months. "Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters. TSMC is an exporter. However, tariffs can lead to slightly higher prices, and when prices go up, demand may go down," he said. "If demand drops, TSMC's business could be affected. But I can assure you that AI demand has always been very strong and it's consistently outpacing supply." In April, the company, the world's largest contract chipmaker, gave a bullish outlook for the year on robust demand for AI applications. In a sign of the strength of demand, Wei said TSMC's job is to provide its customers "with enough chips, and we're working hard on that. 'Working hard' means it's still not enough." Wei also commented on media reports that the company has been evaluating building chip factories in the United Arab Emirates, saying they have no plans for any such plants in the Middle East.

TSMC CEO Admits Trump Tariffs Have 'Some Impact' On Chipmaker But Demand 'Consistently Outpacing' Supply Thanks To AI - Samsung Electronics Co (OTC:SSNLF), Taiwan Semiconductor (NYSE:TSM)

On Tuesday, Taiwan Semiconductor Manufacturing Co. TSM CEO CC Wei said that while U.S. tariffs are creating some headwinds, robust demand for AI chips continues to exceed the company's supply capabilities. What Happened: Speaking at TSMC's annual shareholder meeting in Hsinchu, Taiwan, Wei acknowledged that the tariffs imposed under President Donald Trump's trade policies are having an indirect impact, reported Reuters. "Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters," he said, adding that TSMC is an exporter. "However, tariffs can lead to slightly higher prices and when prices go up, demand may go down." See Also: Ford Recalls Nearly 150,000 Vehicles Over Brake And Powertrain Issues: NHTSA Despite this, Wei highlighted that demand for AI-related chips remains exceptionally strong. "If demand drops, TSMC's business could be affected. But I can assure you that AI demand has always been very strong and it's consistently outpacing supply," he stated. Wei also denied reports that TSMC plans to build chip factories in the UAE and reaffirmed compliance with U.S. and Taiwanese regulations regarding export controls, particularly after halting shipments to China's Sophgo. Why It's Important: Last month, Taiwan's Minister of Economic Affairs, JW Kuo, stated that the U.S. tariffs are not a concern for Taiwanese manufacturers. He underscored America's reliance on Taiwan to strengthen its microchip manufacturing capabilities. Latest Startup Investment Opportunities: Rad IntelDealMakerMin. Investment$1,000IndustryAIGet Offer Elf LabsDealMakerMin. Investment$974IndustryTechGet Offer Kuo also predicted that Samsung Electronics Co. SSNLF is likely to be the most affected by the tariffs, citing the company's limited capacity in advanced semiconductor production. In April, Trump warned that tariffs of up to 100% could be imposed on TSMC if the chipmaker failed to establish manufacturing facilities in the U.S. Price Action: TSMC shares rose 0.79% on Monday and gained an additional 0.24% in after-hours trading, closing at $195.30. Despite the recent gains, the stock is still down 3.34% year-to-date, according to Benzinga Pro. Benzinga's Edge Stock Rankings indicate that TSMC exhibits a positive price trend over the short, medium and long term. You can find more in-depth metrics here. Photo Courtesy: Shutterstock/Jack Hong Read Next: Charlie Munger Once Said Warren Buffett Is A 'Learning Machine' And That's What Lies Beneath Berkshire Hathaway's Success From One Decade To Another Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. SSNLFSamsung Electronics Co Ltd$42.48-%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentumNot AvailableGrowthNot AvailableQualityNot AvailableValueNot AvailablePrice TrendShortMediumLongOverviewTSMTaiwan Semiconductor Manufacturing Co Ltd$195.301.02%Market News and Data brought to you by Benzinga APIs

TSMC CEO Tells Trump $100 Billion US Chip Expansion Will 'Take Time' Amid Tariff Pressures, Surging AI Demand - Taiwan Semiconductor (NYSE:TSM)

Taiwan Semiconductor Manufacturing Company Limited TSM CEO C.C. Wei revealed during Tuesday's shareholder meeting that he informed President Donald Trump that establishing a proposed $100 billion U.S. manufacturing venture will "take time," beyond the anticipated timeline. What Happened: Wei disclosed that TSMC has maintained ongoing dialogue with the U.S. Commerce Department regarding Trump's semiconductor tariffs since their implementation, reported Baha Breaking News. The CEO expressed concerns that higher duties would elevate TSMC's U.S. production costs, though he emphasized that tariff policies remain "ultimately a matter between governments, not between a government and a company." Despite tariff headwinds, Wei assured investors that artificial intelligence chip demand continues to substantially outpace supply capabilities. See Also: Elizabeth Warren Says Trump 'Approved' The Largest Meat Company In World To Be Listed On NYSE Ignoring Corruption And Bribery History, Demands Answers Why It Matters: The CEO explained that while tariffs don't directly impact TSMC as an exporter, they create indirect pressure through higher import costs for customers. "Tariffs can lead to slightly higher prices and when prices go up, demand may go down," Wei noted. TSMC's cautious stance on U.S. expansion comes as the chipmaker weighs the massive $100 billion investment over four years to build advanced manufacturing facilities stateside. The company has already committed over $65 billion to Arizona fabrication plants for advanced chip production. Price Action: TSMC closed at $194.84 on June 2, up 0.79%. After hours, it rose 0.24% to $195.30. Year to date, the stock is down 3.34%. Benzinga's Edge Stock Rankings show TSMC is enjoying a strong price trend across short, medium, and long-term horizons. For a deeper dive into the metrics, click here. Read Next: Bill Gates Commits Majority Of $200 Billion Foundation Budget To Africa Over Next 20 Years Amid Trump's Massive USAID Cuts Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo courtesy: Jack Hong / Shutterstock.com TSMTaiwan Semiconductor Manufacturing Co Ltd$195.300.24%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentum82.73Growth95.12QualityNot AvailableValue51.55Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

TSMC Sees Limited Tariff Impact on AI Strength

By Yang Jie in Tokyo and Joyu Wang in Hsinchu, Taiwan Taiwan Semiconductor Manufacturing Co. faces limited impact from tariffs, its chief executive said, reaffirming that artificial-intelligence demand remains strong, and guided for record earnings. At an annual shareholders' meeting on Tuesday, Chief Executive C.C. Wei said tariffs are typically borne by importers and won't directly affect TSMC, the world's largest contract chip maker. Still, he warned that if tariffs lead to a global economic downturn and higher prices, that would dampen demand, indirectly affecting TSMC's business. Top TSMC clients like Apple and Nvidia have found their supply chains increasingly strained amid widespread uncertainty over President Trump's trade policies. Despite this, Wei reiterated confidence in the strength of AI-driven semiconductor demand. He expects TSMC's revenue and earnings to reach new all-time highs this year. According to Taiwan-based research firm DigiTimes, TSMC and Taiwan's broader foundry industry have seen robust sales growth so far in the April-to-June quarter. That's thanks to continued demand for AI and high-performance computing chips, a rebound in smartphone application processor shipments, and customers' push to build up inventory to get ahead of tariffs, it said in a report Tuesday. "AI will be something you absolutely can't live without in the future," Wei told reporters after the meeting. "As long as there's demand for AI, TSMC will always be a great company with a really promising outlook." Wei also addressed concerns over worker safety at the company's plants and technology theft. A dozen protesters holding a white banner stood outside the event in TSMC's home base of Hsinchu, Taiwan, protesting a string of incidents since 2019 that resulted in deaths and injuries to workers. "Life is precious, and public safety is paramount to us," Wei said. "We recognize areas where we fell short, and I sincerely apologize on behalf of the company." The CEO firmly dismissed shareholders' worries about technology being stolen from TSMC's overseas operations as it expands abroad. Emphasizing robust safeguards and the complexity of its technological capabilities, he said of TSMC's intellectual property: "It cannot be stolen." Wei elaborated that TSMC's cutting-edge tech is the product of over 10,000 research and development engineers, followed by another large team of production engineers who optimize and refine it. "If our technology could be stolen that easily, TSMC wouldn't be where it is today," he said. The CEO said new technologies are first implemented in a so-called "mother fab" in Taiwan before reaching the volume production stage. This involves deploying hundreds of engineers to TSMC's headquarters for training, and another two to three hundred workers to set up production lines abroad. "The technologies have progressed to a point where it's beyond the capacity of an individual, 10 people, or even a hundred, to steal," he said. Wei also denied reports that TSMC is planning to build new chip-fabrication facilities in the Middle East. "Do you think it's possible to have customers in the Middle East? I mean, do you really think that could happen? From what I can see, it's not that easy to build up a semiconductor industry there," he said. Even in an established location like Taiwan, building chip-making facilities requires at least two-and-half years, Wei said. Turning to the U.S. market, Wei said that a shortage of experienced labor in Arizona, where TSMC has manufacturing operations, makes it challenging to ramp up production capacity on American soil. He said Trump had asked if TSMC can complete its announced $100 billion investment in the U.S. within five years or so. Wei said he had told the U.S. president that this would be very difficult, to which Trump replied: "Mr. Wei, do your best." Write to Yang Jie at jie.yang@wsj.com and Joyu Wang at joyu.wang@wsj.com