TSMC bets on AI chips for revival of growth in semiconductor demand

The company however received positive news in the US on Thursday wherein TSMC and Arizona labor unions reached a deal to resolve labor disputes at the company’s upcoming chip factory in Phoenix.

TSMC is investing $40 billion in the facility and has agreed to partner with unions for workforce training and safety transparency, as it aims to start production in the first half of 2025, Bloomberg reported.

AI as a revenue driver

At a recent Supply Chain Management Forum in Taiwan, Wei discussed the challenges of high inflation and the growth opportunities in AI, emphasizing the increasing demand for semiconductors and their role in healthcare, remote work, and reducing energy consumption, local media reported.

Virtually all of TSMC’s semiconductor clients, including Nvidia and AMD are banking on AI to drive demand for their chips.

While Nvidia has been in the spotlight for its AI-ready GPUs, AMD has also made AI a pillar of its growth for 2024 as it launches its MI300 series to compete with Nvidia’s flagship AI processors. 

AMD estimates a $45 billion market for its AI data center processors this year and anticipates over $2 billion in revenue from the sales of its new AI chips in 2024.