TSMC Expands 3nm Chip Production Across Three Continents as AI Demand Drives Record Profits

TSMC Goes Global With 3nm Push

Taiwan Semiconductor Manufacturing Company has unveiled its most aggressive expansion at a single process node, announcing simultaneous 3-nanometre capacity buildouts in Taiwan, the United States, and Japan. Chairman C.C. Wei outlined the plans during the company's quarterly investor conference on 16 April 2026, citing surging demand from artificial intelligence, smartphones, automotive electronics, and Internet of Things applications.

Three Continents, One Mission

In southern Taiwan's Tainan Science Park, TSMC is constructing new 3nm production lines set for mass production in the first half of 2027, while also converting existing 5nm equipment to support the more advanced node. In Arizona, the company's second fab has completed construction, with commercial 3nm production slated for the second half of 2027. In Kumamoto, Japan, TSMC's second fab will adopt 3nm technology with volume production beginning in 2028, backed by a reported $17 billion investment.

Record Earnings Underscore Demand

The expansion follows a blockbuster first quarter. TSMC reported revenue of $35.9 billion, up 40.6% year-on-year and slightly above its own guidance. Net profit surged 58% to approximately $18 billion, marking a fourth consecutive quarter of record earnings. Gross margins hit 66.2% and operating margins reached 58.1%, both exceeding analyst expectations. Advanced chips at 7nm or smaller accounted for roughly 74% of total wafer revenue, with 3nm alone representing 25%.

Looking Ahead

TSMC projected second-quarter revenue of $39 billion to $40.2 billion and revised its long-term gross margin target upward to 56% and above. Capital expenditure for 2026 is expected to come in toward the top of its $52-56 billion guidance range. All four of TSMC's planned U.S. fabs are reported to be fully booked, signalling that demand for advanced AI chips shows no signs of easing.