Taiwan Semiconductor Manufacturing (TSM) gained over 4% on Tuesday after it received a significant boost for its U.S. expansion plans. According to the Taipei Times, Taiwan’s Department of Investment Review approved an additional $7.5 billion investment in the company’s U.S. chip manufacturing subsidiary, TSMC Arizona Corp.
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Importantly, the latest government funding brings the total approved investment for TSMC Arizona to $24 billion. This funding is likely to support the construction of two advanced fabrication facilities (fabs) in the state.
It is worth mentioning that the first fab is set to commence mass production using 4nm process technology in the first half of 2025. Meanwhile, the second fab is expected to begin operations in 2028, utilizing even more advanced 3nm and 2nm technology.
TSM Focuses on Global Expansion
In addition to expanding its manufacturing capabilities in the United States, TSM is actively growing its presence in other regions. The company recently launched a new fab in Kumamoto, Japan, with plans to build a second facility by the end of 2027.
Additionally, TSMC began construction of a 12-inch fab in Dresden, Germany, in August. Furthermore, TSMC has been exploring investment opportunities in the United Arab Emirates (UAE).
Investors should note that the company’s strategic expansion efforts reflect its aim to diversify its manufacturing base and meet the growing global demand for advanced semiconductor technology.
Is Taiwan Semiconductor a Good Stock to Buy?
Turning to Wall Street, TSM has a Strong Buy consensus rating based on five unanimous Buys assigned in the last three months. At $205, the average TSM stock price target implies 12.66% upside potential. Shares of the company have gained over 30% in the past six months.
