TSMC & Customers Agree To a 3nm Price Hike Given That The Taiwan Giant Maintains A Steady Supply

wccftech.com:

TSMC's customers have reportedly agreed to a raise in 3nm chip supply pricing in exchange for the condition that the Taiwan giant keeps up with the semiconductor supply.

TSMC's 3nm Process Is In High Demand, Big Tech Firms Agree To a Price Increase For Steady Supply Chain

With the AI frenzy in play, the companies within the supply chain are the ones to benefit massively from it, especially the semiconductor industry, since the demand has skyrocketed. With the confined supply, firms like TSMC find it challenging to keep up with the order flow. We recently reported on how the Taiwan giant was raising prices of its 3nm node, and it looks like the businesses have now agreed, according to a report by Morgan Stanley. This will likely affect tech behemoths like Apple, NVIDIA, and Qualcomm and would potentially reflect increased consumer product costs.

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According to Morgan Stanley, TSMC has reached an agreement with its customers, who have agreed to comply with higher semiconductor prices, given that the firm keeps up with the supply chain and fulfills orders on time. While we haven't received exact estimates of the price increase, Morgan Stanley says that TSMC is all set to see a rise in gross margins, expected to be at 55.1% in 2025 and 60% in 2026. This year, gross margins have already risen by 52.3% due to TSMC's efforts to expand its production facilities to cater to the huge demand.

With the rise in gross margins, the Taiwan semiconductor giant plans to spend big on expenditures, and given that the company has already started the development of the next-gen 2nm process, TSMC will need to ramp up its investments, which is why the firm is estimated to spend around $35 billion and $37 billion respectively within the upcoming two years. TSMC is set to initiate production of a small batch of 2nm wafers by this year, and