Taiwan Semiconductor Manufacturing Co. (TSMC) will produce advanced 3-nanometer chips at its second facility in Kumamoto, Japan. This shift marks a significant technology upgrade from the previously planned 6nm and 12nm production lines. TSMC is increasing its total investment in Japanese operations to approximately $17 billion to support these advanced manufacturing capabilities.
Surging global demand for high-performance computing and artificial intelligence (AI) applications drove the strategic pivot. The expansion allows TSMC to diversify its manufacturing footprint beyond Taiwan. The Japanese government views the project as crucial for economic security and domestic chipmaking capabilities.
Market analysts responded positively to the strategic decision to boost AI-capable capacity. Zacks Investment Research upgraded TSMC’s stock to a strong-buy rating following the announcement. The firm also added the stock to its momentum list, signaling high short-term investor interest.