TSMC Raises Capital Expenditure to Over $60 Billion, Reaching $60-64 Billion

TSMC (2330-TW)(TSM-US) held its earnings call today (16th), announcing a substantial upward revision of its 2026 capital expenditure to $60 billion to $64 billion, a 15% increase from its previous midpoint forecast. This reflects TSMC's accelerated capacity expansion for 2nm and subsequent advanced process technologies to meet strong mid- to long-term customer demand, fueled by robust AI and high-performance computing (HPC) needs.

Previously, TSMC had projected its capital expenditure for this year to be between $52 billion and $56 billion. Prior to this earnings call, foreign investors had anticipated an upward revision—ranging from a conservative $56 billion to an optimistic $58 billion. However, the actual announcement far exceeded expectations.

CFO Huang Ren-Zhao stated that the company's elevated capital spending level is closely tied to higher growth opportunities over the coming years. Leveraging its technological leadership and differentiated manufacturing capabilities, TSMC expressed confidence in capturing long-term structural growth trends in industries such as 5G, AI, and HPC.

Huang noted that customer demand remains robust. In addition to generative AI and AI data center demand, emerging applications of agentic AI are further driving demand for advanced process nodes and computing chips. As a result, TSMC has decided to increase its annual capital budget to continuously expand capacity in advanced logic processes and advanced packaging to support future customer growth.

In terms of capital allocation, approximately 70% to 80% will be invested in advanced process technologies, about 10% in specialty processes, and the remaining 10% to 20% in advanced packaging, testing, mask making, and other related areas.