TSMC Arizona

Project Summary

The U.S. Department of Commerce awarded TSMC Arizona up to $6.6 billion in direct funding under the CHIPS and Science Act. This funding will support TSMC’s investment of more than $65 billion in three greenfield leading-edge fabs in Phoenix, Arizona, which will manufacture the world’s most advanced semiconductors. With this funding, TSMC Arizona plans to construct a scaled leading-edge cluster in Arizona, bringing some of the most-advanced process technologies to the United States and creating approximately 6,000 direct manufacturing jobs, more than 20,000 total unique construction jobs, and tens of thousands of indirect jobs in this decade.

Economic and National Security Impact

This investment in TSMC Arizona represents a significant step in strengthening U.S. economic and national security by incentivizing a reliable domestic supply of the chips that will underpin the future economy, powering the artificial intelligence (“AI”) boom and other fast-growing industries like high-performance computing, consumer electronics, automotive, and Internet of Things.

TSMC is a global leader in semiconductor manufacturing, having pioneered the pure-play foundry business model in 1987, and now manufactures over 90% of the world’s leading-edge logic chips. At full capacity, TSMC Arizona’s three fabs are expected to manufacture tens of millions of leading-edge logic chips that will power products like 5G/6G smartphones, autonomous vehicles, and high-performance computing and AI applications. The advanced chips that TSMC makes for its customers are the backbone of central processing units (“CPUs”) for servers in large-scale datacenters and of specialized graphics processing units (“GPUs”) used for machine learning. Through this investment in TSMC Arizona, the United States will onshore the important hardware manufacturing capabilities that underpin AI’s deep language algorithms and inferencing techniques, helping to strengthen America’s competitive edge in science and technology innovation..

As part of this award, TSMC Arizona plans to manufacture its N3, N4, and N5 FinFET process technologies, and N2 and A16 nanosheet process technologies in the United States.

• TSMC’s N4 and N5 FinFET process technologies are important inputs for smartphone and high-performance computing applications.
• TSMC’s N3 process technology is the industry’s most advanced FinFET semiconductor technology in production today, offering the best power, performance, and area for leading-edge chips, and is currently the driving node for artificial intelligence and high-performance compute applications. TSMC’s N3 technology is expected to have significant staying power across multiple important applications for the world’s most advanced technologies.
• TSMC’s N2 nanosheet process technology makes further advances in both density and energy efficiency.
• TSMC’s A16 technology integrates TSMC’s N2 nanosheet transistor process with next-generation backside power delivery, improving total performance and power consumption. A16 is optimized for high-performance computing applications with complex signal routes and dense power delivery networks

TSMC Arizona is on track to begin high-volume production in the first fab by the first half of 2025, with production beginning in the second fab in 2028 and in the third by the end of the decade.

Currently, the United States is home to the companies at the forefront of developing and advancing AI across the world. The vast majority of TSMC’s leading-edge customers are American companies, including AMD, Apple, NVIDIA, and Qualcomm. By investing in TSMC Arizona, the Biden-Harris Administration is incentivizing a reliable domestic supply of the leading-edge chips that U.S. companies need for the research, innovation, development and production of AI and other technologies. TSMC Arizona has also committed to support the development of advanced packaging capabilities with its partners – the next frontier of technology innovation for chip manufacturing – in the United States, providing a future opportunity for TSMC Arizona’s customers to be able to purchase advanced chips that are made entirely on U.S. soil

Financial and Commercial Terms

As stated in the CHIPS Notice of Funding Opportunity for Commercial Fabrication Facilities, the CHIPS Program Office (CPO) will disburse direct funding to TSMC Arizona for capital expenditures for the project based on the completion of construction, production, and commercial milestones, and disburse loans to TSMC Arizona for amounts invested in capital expenditures. CPO will track the performance of each CHIPS Incentives Award via financial and programmatic reports, in accordance with the award terms and conditions. All CHIPS funding recipients are required to adhere to restrictions pursuant to the CHIPS Act and NOFO regarding stock buybacks and National Security Guardrails. The Department and TSMC Arizona have agreed that the company will not engage in stock buybacks for a period of 5 years, subject to exceptions specified in the award agreement.  

Workforce, Community, and Environmental Commitments

As part of our commitment to transparency, for information on the local and community impact of this project, please download our Community Impact Report.

Progress Photos