AI Chip Supply Crunch

TSMC CEO Foresees AI Chip Shortage Lasting Years Despite Capacity Expansion

TSMC’s CEO C.C. Wei said global semiconductor supply will remain insufficient for AI-driven demand for years, even as the company expands capacity in the United States, and that the shortage should continue to support strong revenue growth. At the company’s annual shareholder meeting in Taiwan, Wei reiterated a sales-growth outlook of more than 30% and said it will take a long time before TSMC can fully meet customer needs. He also suggested TSMC is open to higher chip prices to protect profitability but rejected sudden price jumps seen in past memory cycles, emphasizing long-term sustainability. Wei indicated major capital investment will likely stay elevated, with annual capex expected in the roughly $52 billion to $56 billion range, and said he does not currently see signals to cut spending. The AI chip bottleneck is also prompting extended lead times and encouraging some customers to consider alternative suppliers, while competitors such as Intel are positioning themselves as potential “relief valves” for the constrained supply chain. TSMC additionally pointed to profit strength tied to AI and high-performance computing and confirmed plans for employee bonuses to rise by more than 30% this year.

Key Points

Topics