Taiwan Semiconductor Manufacturing Co. is dramatically increasing its investment in the United States, announcing plans to pour another $100 billion into expanding its American manufacturing operations as soaring demand for artificial intelligence chips drives record-breaking earnings.

The new commitment raises TSMC’s total planned U.S. investment to approximately $265 billion. The company also boosted its full-year revenue outlook after posting its strongest quarterly profit ever, fueled by the explosive growth of AI technologies.

As the world’s largest contract chip producer and one of the most valuable companies on the globe, TSMC is widely viewed as a bellwether for both the semiconductor industry and the rapidly expanding AI sector. Its performance comes as investors continue debating whether the AI market’s rapid rise can be sustained.

To keep pace with surging demand for AI processors, TSMC has continued expanding its manufacturing footprint in the United States, Japan, and Taiwan. The company also increased its projected capital spending for the year, raising its investment budget to between $60 billion and $64 billion, up from its previous forecast of $52 billion to $56 billion.

TSMC manufactures advanced chips for some of the world’s biggest technology companies, including Nvidia and Apple. Before Thursday’s announcement, the company had already committed $165 billion toward constructing six semiconductor fabrication plants in Arizona.

According to Chairman and CEO C.C. Wei, the additional investment is intended to “support the strong multiyear demand from our leading U.S. customers,” he said during the company’s quarterly earnings conference Thursday.

“We believe this investment will help to further foster the development of the U.S. semiconductor ecosystem, strengthen the supply chain and support an increasing number of high-tech, high-paying jobs in the United States,” he said.

Wei also said demand tied to artificial intelligence remains exceptionally strong around the world, noting that AI-related growth continues to accelerate.

AI-related demand globally continues to be “extremely robust,” Wei added, as the “AI megatrend continues to drive the need for more and more computation.”

The company reported net income of 706.6 billion New Taiwan dollars—roughly $22 billion—for the April through June quarter, representing a 77% increase from the same period last year. The record-setting results exceeded Wall Street expectations and underscored the continuing strength of the AI-driven semiconductor market.

{Matzav.com}