TSMC in Talks with NVIDIA to Produce Blackwell AI Chips in Arizona

TSMC, NVIDIA in Talks for AI Chip Production in Arizona

Regardless, the chips would return to Taiwan for packaging due to the lack of chip-on-wafer-on-substrate capacity in Arizona. Taiwan Semiconductor Manufacturing Co. (TSMC) is in talks with NVIDIA to produce its Blackwell AI chips at its Arizona facility, Reuters reported. The company unveiled the chips in March and said they were being manufactured at its Taiwan facilities. The publication, quoting anonymous sources, said TSMC is preparing to start production early next year at its Arizona site. The plant, part of TSMC's multibillion-dollar investment in Phoenix, is scheduled to begin production in 2024. The sources also added that if the deal is finalised, NVIDIA would join Apple and AMD as customers at the Arizona facility. NVIDIA's Blackwell chips are in high demand for generative AI and accelerated computing applications. According to the giant, the chips are 30 times faster at tasks like answering chatbot queries. While the Arizona plant would handle the front-end process of Blackwell chip production, the chips would need to return to Taiwan for packaging due to the lack of chip-on-wafer-on-substrate (CoWoS) capacity in Arizona. All of TSMC's CoWoS capacity is currently in Taiwan. NVIDIA did not respond to AIM's queries. TSMC is also building three facilities in Phoenix with support from U.S. government subsidies aimed at strengthening domestic semiconductor production. The talks with Nvidia highlight the Arizona plant's growing role in meeting the global demand for advanced AI chips. In October 2024, Nvidia began shipping Blackwell chips to key partners, including OpenAI and Microsoft. OpenAI reported that the new DGX B200 systems, powered by Blackwell, provide three times faster training speeds and fifteen times greater inference performance compared to previous models. The demand for Blackwell chips has propelled the company's financial performance. In the third quarter of fiscal 2025, the company reported record revenue of $35.1 billion, a 94% increase year-over-year, controlling 95% of the AI chip market. The data centre segment contributed $30.8 billion, up 112% from the same period last year. NVIDIA's CEO, Jensen Huang, noted that Blackwell production is "running at full steam" to meet the staggering demand. In Q1 2024, NVIDIA also led all vendors in component revenues, accounting for nearly half of the reported figures, as supplies of its H100 GPUs improved for both cloud and enterprise markets. The capabilities of Blackwell chips have also enabled advancements in AI infrastructure, breaking the rise of Moore's Law. In September 2024, Oracle unveiled the world's first zettascale AI supercomputer, incorporating 131,072 Blackwell GPUs to deliver 2.4 zettaFLOPS of peak performance. This development underscores the growing importance of high-performance AI hardware in supporting large-scale AI workloads. NVIDIA's ongoing efforts to enhance AI chip performance and production capacity reflect the increasing demand for advanced computing solutions across various industries.

TSMC could make NVIDIA Blackwell AI GPUs in the USA at Fab 21 near Phoenix, Arizona

TSMC is reportedly in discussions with NVIDIA to make its Blackwell AI GPUs in the USA, producing the world-leading AI chips at its new Fab 21 plant in Phoenix, Arizona. In a new report from Reuters, we're learning that TSMC is "already making preparations to start production" in early 2025, according to Reuters' sources. NVIDIA unveiled its new Blackwell AI GPUs in March, and are now making their way into tech companies' hands in the form of B200 and GB200, with GB200 NVL72 AI server cabinets insanely popular. If the agreement between TSMC and NVIDIA is made, it would see the Taiwanese contract manufacturer securing another high-profile client for its US semiconductor manufacturing. TSMC is already preparing to make next-gen chips for the likes of Apple and AMD on US soil, so if NVIDIA joins the party... it's going to be a rather big deal to have some of the most advanced AI chips made in the United States. However, while TSMC could produce the front-end process of NVIDIA's Blackwell chips in Arizona, the AI GPUs would need to be sent to Taiwan for the advanced packaging side of things. TSMC's new Fab 21 in Arizona doesn't have the CoWoS advanced packaging line, with every bit of TSMC's CoWoS capacity in Taiwan.

TSMC May Produce Nvidia Blackwell AI Chips in Arizona

Nvidia may see at least part of its Blackwell AI GPUs made in Arizona at Taiwan Semiconductor Manufacturing Corp's first Arizona plant, which is slated to begin production for clients in 2025. Because the Blackwell design uses an improved version of TSMC's 4-nanometer process and TSMC already makes other chips for Nvidia, it's less of a question as to who might produce the chips, but rather where they will be made. Nvidia and TSMC have been discussing the Arizona deal, and while not yet finalized, TSMC is already preparing to start production on the chips in the US. That's according to a report from Reuters published on Thursday, citing two anonymous sources. TSMC won't be able to produce the entire Blackwell GPU in the US, however. The chips will have to be sent to Taiwan for the packaging process because the Arizona location won't have TSMC's "chip wafer on substrate," or CoWoS, which the chips require, according to the report. Apple and AMD will also be customers at the new TSMC Arizona plant, which is located in the northwest Phoenix area between Anthem and Deer Valley. TSMC's website states that this first Arizona plant will open in the "first half" of 2025. Nvidia CEO Jensen Huang visited the construction site when work began back in 2022 and spoke during an event there celebrating the start of construction. TSMC has two more plants under construction in the state that are being supported by $6.6 billion in grants and $5 billion in loans from Biden's Chips Act. The second Arizona plant is scheduled to open in 2028, and the third is expected to open by 2030. Nvidia's Blackwell product was designed for AI processing needs. The company claims it can be 30 times faster at completing AI-related tasks. The Blackwell launch has faced some delays this year due to a design issue and then an issue with the Blackwell server racks, but both have reportedly since been resolved. PCMag has reached out to TSMC and Nvidia for comment.

Exclusive-TSMC in talks with Nvidia for AI chip production in Arizona, sources say

TAIPEI/SINGAPORE (Reuters) - Taiwan Semiconductor Manufacturing Co is in discussions with Nvidia Corp to produce its Blackwell artificial intelligence chips at the contract manufacturer's new plant in Arizona, three sources familiar with the matter said. TSMC is already making preparations to start production early next year, the sources said. Nvidia's Blackwell chips, which the company unveiled in March, have so far been manufactured at TSMC's facilities in Taiwan. The company has seen high demand from customers involved in generative AI and accelerated computing for the chips, which it says is 30 times speedier at tasks like serving up answers from chatbots. The agreement, if finalised, would secure another customer for TSMC's Arizona facility, which is scheduled to start volume production next year. TSMC and Nvidia declined to comment. The sources did not want to be identified as the talks were confidential. Two of the sources said Apple and Advanced Micro Devices are current customers at the Arizona plant. Apple and AMD did not immediately respond to requests for comment. However, while TSMC plans to produce the front-end process of Nvidia's Blackwell chips in Arizona, the chips will still need to be shipped back to Taiwan for packaging. The Arizona facility does not have chip on wafer on substrate (CoWoS) capacity that is essential to the Blackwell chips, two of the sources said. All of TSMC's CoWoS capacity is currently in Taiwan. Taiwan's TSMC, the world's largest contract chipmaker, is investing tens of billions of dollars in building three facilities in Phoenix and the project has won significant subsidies from the U.S. government which wants to bring semiconductor manufacturing back to the United States. (Reporting by Wen-Yee Lee in Taipei and Fanny Potkin in Singapore; Editing by Brenda Goh and Jacqueline Wong)

TSMC in talks with Nvidia to produce Blackwell AI chips at Arizona plant - report By Investing.com

Investing.com -- Taiwan Semiconductor Manufacturing (NYSE:TSM) (TSMC) is in talks with Nvidia Corp (NASDAQ:NVDA) to produce the tech giant's Blackwell AI chips at TSMC's new facility in Arizona, Reuters reported Thursday, citing sources familiar with the matter. TSMC is gearing up to begin production early next year, the report said. Currently, Nvidia's Blackwell chips, introduced in March, are produced at TSMC's facilities in Taiwan. These chips, which have gained significant traction among customers working in generative AI and accelerated computing, are touted to deliver performance up to 30 times faster for tasks such as chatbot responses. If finalized, the deal would add Nvidia to the roster of clients for TSMC's Arizona plant, which is expected to commence large-scale production next year. The report said that Apple (NASDAQ:AAPL) and Advanced Micro Devices (NASDAQ:AMD) are the current customers at the facility. However, TSMC plans to conduct only the initial manufacturing stages for the Blackwell chips in Arizona. The chips will need to be shipped back to Taiwan for advanced packaging, as the Arizona plant lacks the Chip-on-Wafer-on-Substrate (CoWoS) capability crucial for Blackwell chips, according to Reuters. At the moment, all of TSMC's CoWoS operations are based in Taiwan. TSMC, the world's largest contract chipmaker, is investing tens of billions of dollars into three new facilities in Phoenix. This initiative has received substantial US government subsidies, aligning with efforts to boost domestic semiconductor manufacturing. Specifically, the US Commerce Department announced earlier this year that TSMC's US division will receive a $6.6 billion subsidy to support advanced semiconductor production at its Phoenix, Arizona facility, along with up to $5 billion in low-interest government loans. In return, TSMC has committed to increasing its planned investment in the project by $25 billion, bringing the total to $65 billion. The company also agreed to construct a third Arizona fabrication plant by 2030.

TSMC is reportedly in talks with Nvidia to make Blackwell GPUs in Arizona -- Blackwell silicon needs to be shipped back to Taiwan for assembly

TSMC could move production of some of Nvidia's Blackwell GPUs to America. TSMC is negotiating with Nvidia to produce its Blackwell GPUs for AI at its Fab 21 near Phoenix, Arizona, reports Reuters. If the companies ink an appropriate agreement, Nvidia might get additional Blackwell GPUs produced in the U.S., undoubtedly pleasing its customers and politicians. There are a couple of catches, though. Nvidia's Blackwell GPUs are made using TSMC's custom 4NP (4nm-class) process technology that can be relatively easily ported from the foundry's fabs in Taiwan to its Fab 21 in Arizona, which is designed to make chips on 4nm and 5nm-class production nodes. Nvidia's highest-end Blackwell GPUs for AI and HPC rely on TSMC's CoWoS-L (B100, B200, B300, etc.) and CoWoS-S (B200A, B300A) packaging. TSMC does not have an advanced packaging facility in the U.S., and its partner Amkor will only start packaging chips in Arizona in 2027. As a result, Blackwell AI silicon produced in Arizona will need to be shipped back to Taiwan for final assembly, as all of TSMC's CoWoS packaging capacity remains in Taiwan. Shipping to Taiwan would add costs, but since most AI servers are assembled in Taiwan anyway, this should not create a significant logistics problem. Theoretically, Nvidia could redesign Blackwell silicon for production in the U.S. and use Intel's EMIB and Foveros 3D packaging instead of TSMC's advanced packaging methods. However, that would increase costs, too. Still, if Nvidia wants all-American Blackwell GPUs for AI, this could be a way to achieve this. Hypothetically, Nvidia could also produce Blackwell gaming GPUs at Fab 21 and, therefore, free up capacity for Blackwell AI GPUs in Taiwan. These chips do not require sophisticated packaging, so they could be assembled in the U.S. However, since nobody produces graphics cards in America these days and TSMC is set to charge extra for chips made outside of Taiwan, it hardly makes a lot of sense to make gaming GPUs in Arizona. Apple and AMD are confirmed as customers of TSMC's Fab 21 in Arizona. Still, neither company has officially disclosed products set to be made in the U.S., even though a rumor is that Apple makes its A16 Bionic at the facility. Nvidia and TSMC also declined to comment on the ongoing negotiations to Reuters as they are confidential.

Exclusive: TSMC in talks with Nvidia for AI chip production in Arizona, sources say​

TAIPEI/SINGAPORE, Dec 5 (Reuters) - Taiwan Semiconductor Manufacturing Co (2330.TW), opens new tab is in discussions with Nvidia Corp (NVDA.O), opens new tab to produce its Blackwell artificial intelligence chips at the contract manufacturer's new plant in Arizona, three sources familiar with the matter said. TSMC is already making preparations to start production early next year, the sources said. Nvidia's Blackwell chips, which the company unveiled in March, have so far been manufactured at TSMC's facilities in Taiwan. The company has seen high demand from customers involved in generative AI and accelerated computing for the chips, which it says is 30 times speedier at tasks like serving up answers from chatbots. The agreement, if finalised, would secure another customer for TSMC's Arizona facility, which is scheduled to start volume production next year. TSMC and Nvidia declined to comment. The sources did not want to be identified as the talks were confidential. Two of the sources said Apple (AAPL.O), opens new tab and Advanced Micro Devices (AMD.O), opens new tab are current customers at the Arizona plant. Apple and AMD did not immediately respond to requests for comment. However, while TSMC plans to produce the front-end process of Nvidia's Blackwell chips in Arizona, the chips will still need to be shipped back to Taiwan for packaging. The Arizona facility does not have chip on wafer on substrate (CoWoS) capacity that is essential to the Blackwell chips, two of the sources said. All of TSMC's CoWoS capacity is currently in Taiwan. Taiwan's TSMC, the world's largest contract chipmaker, is investing tens of billions of dollars in building three facilities in Phoenix and the project has won significant subsidies from the U.S. government which wants to bring semiconductor manufacturing back to the United States. Reporting by Wen-Yee Lee in Taipei and Fanny Potkin in Singapore; Editing by Brenda Goh and Jacqueline Wong Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Artificial IntelligenceArtificial Intelligence

NVIDIA's Blackwell GPUs Might Be Made In US But Shipped To Taiwan For Packaging - Report

This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy. The Taiwan Semiconductor Manufacturing Company's (TSMC) new chip manufacturing facilities in Arizona might have scored a big win, as sources suggest that NVIDIA is in talks with the company to produce its leading-edge Blackwell artificial intelligence graphics processing units (GPUs) at the site. NVIDIA's Blackwell GPUs are among the hottest commodities in the world as big tech scurries to procure the chips and train and operate the latest AI models. The report comes courtesy of Reuters, which quotes three sources that are knowledgeable about the discussions. TSMC scored a major win last month after the Biden-Harris Administration finalized a whopping $6.6 billion in funding for the firm's Arizona plants. The award covers three new manufacturing facilities at the Arizona site. The first of these is slated to start production in the first half of 2025, while the other two will start production in 2028 and by the end of the decade according to the Department of Commerce. The first plant will manufacture chips using TSMC's 4-nanometer and 5-nanometer manufacturing technologies. The Taiwanese firm's latest chip making technology is the 3-nanometer process that is currently used in smartphone and personal computing applications. High performance computing products such as GPUs typically rely on slightly older technologies as they are mature enough to withstand loads from computing large and complex workloads. In a fresh report, Reuters claims that TSMC and NVIDIA are in discussions about producing NVIDIA's Blackwell GPUs in Arizona. The publication cites three sources with internal knowledge of the matter. If their claims are true, then it is likely that the Blackwell GPUs are built using either TSMC's 4-nanometer or 5-nanometer process technologies since the sources add that TSMC is gearing up to kick off production in 2025. Yet, despite the fact that TSMC might win NVIDIA's orders for its Arizona facilities, packaging remains a key bottleneck for the site's AI chip production needs. Packaging is part of the process of assembling the chips in a final usable form, and according to Reuters' sources, if TSMC produces Blackwell GPUs in Arizona, then it will ship them back to Taiwan for packaging. Blackwell is packaged with TSMC's chip-on-wafer-on-substrate, or CoWoS, technology, and the fab has invested substantial amounts to expand its packaging capacity to meet AI demand. Packaging was one of the earliest bottlenecks identified by analysts for AI chip production. As per Taiwanese industry news, the firm plans to invest as much as $16 billion to expand its packaging capacity. If it does produce Blackwell GPUs in Arizona and ship them to Taiwan for packaging, then the entire ordeal might be temporary. As part of its plans for the Arizona site, TSMC announced a deal with Arizona-based packaging firm Amkor to add CoWoS and Integrated FanOut (InFO) packaging capabilities to the Arizona site. Packaging has also been a potentially contentious issue between NVIDIA and TSMC, with sources in Taiwan claiming that TSMC colorfully turned down a request from NVIDIA CEO Jensen Huang to set up a dedicated packaging line for NVIDIA's products. The sources also shared that AMD and Apple have signed up to procure chips from the Arizona site. Neither firm commented on the report, but Apple CEO Tim Cook confirmed in 2022 that his firm would use chips from Arizona.

TSMC in Talks To Produce Blackwell AI Chip for Nvidia in Arizona, Report Says

Taiwan Semiconductor Manufacturing Co. (TSM) reportedly is in talks with Nvidia (NVDA) to produce the artificial intelligence (AI) darling's Blackwell chips at the contract manufacturer's new plant in Arizona. According to Reuters, TSMC is preparing to start producing the AI chips early next year. Those chips have been made in TSMC's plants in Taiwan. The report said that even though the chips could be made in the U.S., they would still have to be sent back to Taiwan to be packaged. The Biden administration earlier this year announced that TSMC would receive $6.6 billion in direct federal funding for the Arizona factory complex. TSMC is the world's largest contract chip maker and also counts Apple (AAPL) and Broadcom (AVGO) among its customers. American depositary receipts (ADRs) of the Taiwanese company are little changed in premarket trading but have nearly doubled this year.

Nvidia Could Relocate Blackwell Production to Arizona, a Boost for US Chip Manufacturing

Winning the Nvidia contract would be a significant victory for the new facility, which is expected to start mass production in the first half of 2025. Next year, Taiwan Semiconductor Manufacturing Company (TSMC) is expected to begin producing microchips at its new facility in Phoenix, Arizona. As the company prepares to launch operations at its first U.S. location, TSMC is reportedly in discussions with Nvidia about manufacturing its highly sought-after Blackwell GPUs there. TSMC's American Adventure First announced in 2020, TSMC Phoenix represents a new era of American expansion for the Taiwanese chipmaker. While not the first to be built in the U.S. (that title goes to TSMC Washington), the new factory will be the first in the country equipped for the five-nanometer manufacturing process. Meanwhile, a second plant expected to be completed in 2028 and a third just recently announced , will house cutting-edge three- and two-nanometer technology. By the time the three fabrication plants are up and running, TSMC will have invested $65 billion into its Arizona operations. The massive investment, which has provided a huge boost to the state's economy, has been fleshed out with generous subsidies from the CHIPS Act, including tax incentives and $6.6 billion in direct funding. Nvidia to Relocate Production While TSMC has produced components for Nvidia in Washington in the past, modern AI processors require more advanced manufacturing setups. As a result, Nvidia has outsourced production to better-equipped locations in Taiwan and South Korea. However, as reported by Reuters on Dec. 5, TSMC is in advanced talks to produce Nvidia's Blackwell chips at the new facility and is already making preparations to start production early next year. So far, the AI chips have been manufactured exclusively at TSMC's plants in Taiwan. But given that so many of Nvidia's data center customers are based in the U.S., relocating to Arizona makes a lot of sense. Amid uncertainty around the scope of Donald Trump's expected tariff regime, moving production to the U.S. could also provide a significant buffer against any subsequent supply chain shock. Made-in-America Semiconductors The success of TSMC Phoenix and Nvidia's plan to relocate Blackwell production to the U.S. represents the culmination of years of geopolitical wrangling over semiconductor manufacturing. Even before President Biden made the issue a priority on national security grounds, industry voices had been calling for actions to shore up domestic production and reduce American firms' reliance on Asian semiconductor fabrication plants. Post-pandemic efforts to build more resilient supply chains have seen a resurgence of interest in American manufacturing, extending from AI chips to Bitcoin mining equipment and beyond.

Nvidia Could Become Taiwan Semi's Third US Plant Customer, But With A Catch - NVIDIA (NASDAQ:NVDA), Taiwan Semiconductor (NYSE:TSM)

However, TSMCr's chip-on-wafer-on-substrate (CoWoS) capacity is currently in Taiwan. Taiwan Semiconductor Manufacturing Co TSM and Nvidia Corp NVDA are exploring production of the front-end process of Blackwell artificial intelligence chips at the former Arizona plant, Reuters cites familiar sources. Taiwan Semiconductor has so far manufactured Nvidia's Blackwell chips in its Taiwan facilities, where its chip-on-wafer-on-substrate (CoWoS) capacity exists. Also Read: ZJK Industrial Surges On Nvidia Liquid Cooling Collaboration (UPDATED) Therefore, it must ship the Blackwell chips back to Taiwan for packaging, which renders Nvidia vulnerable to U.S. geopolitical tensions with China. For context, China continued threats and military exercises around Taiwan. Meanwhile, most of Taiwan Semiconductor's production capacity is based in Taiwan. The key Nvidia supplier targets mass production of the Blackwell chips in early 2025. Taiwan Semiconductor's current Arizona plant customers reportedly include Apple AAPL and Advanced Micro Devices Inc AMD. Earlier this week, Amazon.Com Inc's AMZN cloud unit claimed that it could connect more chips than Nvidia and could train some AI models at a 40% discount to Nvidia chips. Amazon Web Services showcased its data center servers embedded with its AI chips, dubbed Trn2 UltraServers. These servers target Nvidia's flagship server, which is packed with the latest Blackwell chips. Amazon also disclosed that it is building artificial intelligence supercomputers in collaboration with Anthropic, which will feature Amazon's latest AI training chip, Trainium 2. Previous reports claimed Nvidia's production challenges of Blackwell chips hampered AWS' data center plans. Despite production challenges, Oppenheimer analyst Rick Schafer projected several billion dollars in revenue from Blackwell for the January quarter. He noted investors are modeling between 5 and 6 million Blackwell GPUs in 2025. Nvidia stock has surged over 201% year-to-date. Taiwan Semiconductor stock gained 98%. Investors can gain exposure to Nvidia through ProShares Ultra Semiconductors USD and EA Series Trust Strive U.S. Semiconductor ETF SHOC. Price Actions: NVDA stock traded lower by 0.02% at $145.10 premarket at the last check on Thursday. TSM is up 0.37%. Also Read: Taiwan Semi Supplier ASML Reiterates Outlook As Biden's Latest Semiconductor Embargo On China Kicks In Photo courtesy of Nvidia Market News and Data brought to you by Benzinga APIs