Taiwan Semiconductor Manufacturing Co. has announced plans to establish mass production of its 3-nanometre process node at its Kumamoto, Japan, facility, with a capital investment of approximately $17 billion. This expansion represents the company’s first offshore deployment of its most advanced manufacturing technology and is expected to create thousands of jobs in the region. Construction of the new cleanrooms and installation of extreme ultraviolet lithography equipment will begin in mid-2026, with volume production slated to start in the second half of 2027. The move aims to diversify TSMC’s geographic footprint and secure capacity for key customers in high-performance computing and mobile device segments.

In the fourth quarter, TSMC reported record revenues of $33.73 billion, a 25.5% increase year-over-year and 1.9% sequential growth, surpassing the midpoint of its guidance by 2.8%. The strength was driven by robust demand from both smartphone manufacturers and hyperscale cloud providers investing heavily in AI accelerators. High-performance computing applications accounted for more than 40% of wafer revenue, while 5-nanometre and below process nodes represented over 55% of total capacity utilization. Gross margin held steady above 50%, reinforcing the company’s pricing power amid capacity constraints in leading-edge nodes.

TSMC’s leadership has reiterated its long-term outlook, forecasting compound annual revenue growth of 25% and mid-to-high 50% growth in AI-accelerator wafer shipments through 2029. The company expects next-generation process nodes—including N2, N2-plus, and the A16 family—to enter volume production starting in the second half of 2026. These platforms, designed for data center and mobile AI workloads, are projected to contribute over 20% of total revenue by 2028. Management highlighted ongoing collaborations with major hyperscalers and fabless customers as key drivers of capacity expansion plans and the firm’s sustained technology leadership.