Taiwan Semiconductor's advanced process capacity remains tight, and supply chain sources indicate that the foundry price for its 3-nanometer nodes could rise by approximately 15% in the second half of the year. Management had previously sent clear signals about a potential price increase, citing inflation-driven cost pressures and stating that price hikes cannot be ruled out.
$Taiwan Semiconductor (TSM.US)$ It is currently facing persistent tightness in advanced process capacity, and supply chain sources indicate that its foundry prices for the second half of the year may be raised, with the 3-nanometer process price increase expected to reach 15%.
According to media reports, supply chain sources revealed that Taiwan Semiconductor plans to moderately adjust pricing for its advanced process foundry services in the second half of the year to address upward cost pressures from upstream suppliers. The 3-nanometer process, which faces the tightest demand-supply conditions, is expected to see a price increase of around 15%. On June 9, Chief Financial Officer Wendell Huang stated in a media interview that inflation has indeed raised the company's operating costs, and while future price adjustments cannot be ruled out, he explicitly denied the possibility of a 'four- or five-fold' surge.
Meanwhile, Taiwan Semiconductor reported consolidated revenue of NT$416.975 billion in May, up 30.1% year-over-year, marking the third consecutive month above the NT$400 billion threshold and setting a new monthly record. This reflects continued strong demand for AI chips and high-performance computing that remains undersupplied. Analysts believe the likelihood of the company exceeding the upper end of its second-quarter financial guidance has significantly increased, and the structural growth momentum driven by AI is expected to extend into the second half of the year.
Management has clearly signaled upcoming price increases
Taiwan Semiconductor’s management has recently become increasingly explicit about pricing. Chairman and CEO C. C. Wei stated at the annual shareholders’ meeting that he 'hopes' to raise prices, citing that competitors have already taken the lead—an indication widely viewed as the clearest statement to date from Taiwan Semiconductor’s leadership regarding a potential price hike.
CFO Wendell Huang subsequently reaffirmed that inflationary pressures have materially increased the company’s operating costs, making future price adjustments a real possibility, while emphasizing that no drastic price surge would occur.
Market participants interpret recent statements from both C. C. Wei and Wendell Huang as pointing in the same direction: Taiwan Semiconductor is laying the groundwork for a price increase, a move strongly underpinned by robust underlying demand fundamentals.
May revenue hits a new record high; Q2 likely to exceed upper end of financial guidance
Taiwan Semiconductor reported consolidated revenue of NT$416.975 billion in May, up 30.1% year-over-year, maintaining above NT$400 billion for the third consecutive month.
Cumulative consolidated revenue for the first five months reached NT$1.96 trillion, up 30% year-over-year, bringing the company just shy of the NT$2 trillion mark.
According to Taiwan Semiconductor's second-quarter financial guidance, consolidated revenue in U.S. dollars is expected to range between USD 39 billion and USD 40.2 billion, with a midpoint of USD 39.6 billion, representing a sequential increase of approximately 10% and a year-over-year growth of about 32%.
Analysts note that combined April and May revenues have already reached NT$827.7 billion. As long as June remains at a high level, second-quarter revenue in New Taiwan dollars is on track to meet the upper end of the company’s financial guidance and could even set a new record for a single quarter.
Capacity expansion still lags behind demand growth.
Although Taiwan Semiconductor continues to ramp up wafer capacity—with monthly capacity in the second quarter projected to reach 160,000 to 175,000 wafers—industry sources indicate that customer waitlists have not eased significantly, as AI-related demand is growing far faster than market expectations.
According to supply chain sources, price increases for advanced-process nodes are actually favorable for Taiwan Semiconductor’s major clients—the higher pricing threshold further raises market entry barriers for AI chips, helping leading customers secure more capacity and gain a competitive edge.
AI demand is expanding from data centers to diverse application scenarios.
Analysts observe that AI computing demand is spreading from data centers to sovereign AI, enterprise AI, and edge AI applications, driving simultaneous growth in demand for both advanced process technologies and advanced packaging solutions.
Taiwan Semiconductor not only controls key advanced-node capacities such as 3-nanometer and 5-nanometer processes but also leverages advanced packaging technologies like CoWoS and SoIC, positioning itself as a core manufacturing platform in the global AI compute race.
At the annual shareholders’ meeting, C. C. Wei emphasized that AI demand remains robust and that Taiwan Semiconductor is committed to avoiding becoming a bottleneck in the semiconductor supply chain. With major customers’ new platforms entering mass production and scaling phases, the company’s business momentum in the second half of the year remains strongly supported. This AI-driven growth cycle is widely viewed by the market as structural rather than driven by short-term inventory restocking.
Editor/Lee