TSMC accelerates critical chip production in Arizona due to AI-related demand

TSMC is increasing investment in its chip factories to meet AI-related demand for chips, with Arizona playing an integral role in the expansion strategy.

BY AMY EDELEN/PHOENIX BUSINESS JOURNAL

Apr 19, 2026, 5:01 AM Updated: May 1, 2026, 9:56 am

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Taiwan Semiconductor Manufacturing Co. is increasing investment in its chip factories to meet “extremely robust” AI-related demand for chips, with Arizona playing an integral role in its expansion strategy, the company’s executives said during an earnings call Thursday.

TSMC’s chief executive, C.C. Wei, said the company is increasing its annual capital expenditures from $52 billion to $56 billion to boost its N3 capacity and support a multiyear pipeline of demand for 3 nanometer chips, which are used in smartphone and high-performance computing.

Wei confirmed the company’s second Arizona semiconductor factory, or fab, will produce 3-nanometer chips with construction already complete on the building and volume production slated for the second half of 2027.

“Historically, we do not add additional capacity to a node once it reaches its targeted capacity,” Wei said. “However, as a foundry, our first responsibility is to provide our customers with the most advanced technologies and necessary capacity to unleash their innovations.”

This story is posted in partnership with Phoenix Business Journal. Click to read the full story.