The year 2021 was marked by a worldwide shortage of microchips. This unprecedented crisis has affected many industries, to name only smartphones, computers, video game consoles, and even the automobile. And even the best positioned groups, such as Apple, have not been spared.
TSMC is one of the main players of the semiconductor market. The Taiwanese company counts among its customers Apple, Qualcomm, or Mediatek.
While chips were scarce, it had increased its investments. In 2021, TSMC spent 25 billion dollars, in order to increase its production capacities. And in 2022, the company will spend even more.
Indeed, as an article in the Financial Times reports, TSMC has just announced that this year, its capital investments could reach 44 billion dollars. This would represent an increase of 46,7% compared to last year’s investments, and it is a sum three times higher than the investments of 2019.
Despite a possible slowdown in demand
Although analysts predict a slowdown in demand, TSMC would consider these expansions to be essential. According to the Financial Times, as the demand for electronic devices increases, TSMC expects its profits to grow by double digits in the coming years.
“ even if there is a slowdown, we think it could be less volatile for TSMC. So we expect our capacity to remain very tight throughout 2022” , explains CC Wei, the company boss. TSMC expects 25% revenue growth in 2022, which would exceed forecast growth for the entire semiconductor market by 5 points.
In 2021, capitalizing on the demand created by 5G and artificial intelligence, TSMC announced an ambitious plan to 100 billions of dollars to be invested over several years, in order to accelerate production. The company would be convinced that we are currently entering a period during which demand will always be high.
But in addition to anticipating an increase in demand, this rain of billions of dollars could also aim to crush the competition. Indeed, TSMC has to face other large groups, to name only Samsung or Intel.