TSMC raises 2026 capital spending and accelerates advanced chip production targets

Taiwan Semiconductor raised its annual capital expenditure guidance to $60 billion to $64 billion, up from $52 billion to $56 billion, with 70-80% directed toward advanced process nodes as it rushes to meet surging AI chip demand. The company is adding three new 3-nanometer fabrication plants globally (Taiwan, Arizona, and Japan) and expects monthly 2-nanometer wafer output to approach 100,000 units by year-end. Second-quarter results showed strong execution with $40.2 billion in revenue and record net income of approximately $22 billion, driven by continued orders from major customers including Nvidia, AMD, and Broadcom. The company also raised its full-year revenue growth outlook to slightly above 40%, though management cautioned that ramping 2-nanometer production will reduce gross margin by about 3 to 4 percentage points in 2026. Strong customer demand is expected to help TSMC reach its year-end target of 180,000 3-nanometer wafers per month ahead of schedule, potentially by the fourth quarter.

1. 2026 capital expenditure raised to $60-$64 billion, up from prior guidance of $52-$56 billion
2. Approximately 70-80% of capex directed to advanced process technologies
3. Three new 3-nanometer fabs under construction in Taiwan, Arizona and Kumamoto Japan
4. 2-nanometer monthly wafer output expected to approach 100,000 units by end of 2026
5. Q2 revenue reached $40.2 billion; net income approximately $22 billion, both record highs
6. Q2 gross margin 67.7%, up 150 basis points from prior quarter
7. Strong orders from Nvidia, AMD, and Broadcom customers for advanced nodes
8. Full-year 2026 revenue growth outlook raised to slightly above 40% in USD terms