TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center. used its latest earnings briefing to underline two pressures shaping its near-term business: persistent AIartificial intelligence-driven demand and rising cost tension across manufacturing and packaging. The company said overall AIartificial intelligence demand remains extremely strong, and that CPUcentral processing unitMain processor that executes program instructions and performs data operations. demand related to agentic AIartificial intelligence has continued to increase.
The packaging side of the business is becoming a more important constraint as customers integrate GPUgraphics processing unitA GPU is a parallel graphics processor widely used for AI acceleration.s, AIartificial intelligence accelerators, and high-bandwidth memory into one system. TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center. said advanced packaging and silicon interposer capacity are now critical to chip shipments, and that wafer manufacturing and packaging capacity have to be planned together because bottlenecks at either stage can delay final deliveries.
To ease those constraints, TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center. is expanding packaging cooperation with ASEAdvanced Semiconductor EngineeringASE is a semiconductor assembly and packaging company involved in the joint research program., SPIL, Powertech, Amkor, GlobalFoundries, and Vanguard International Semiconductor. A broader division of labor could improve supply flexibility if those partners can meet requirements for quality, yield, delivery schedules, and customer specifications. For TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center., the on-substrate and interposer-related parts of advanced packaging consume capital, factory space, and engineering resources that could otherwise support advanced process development and integration work.
The company also highlighted the margin impact of its expansion plans. Gross margin in the third quarter of 2026 was 66.4%, down 1.3 percentage points quarter over quarter, while operating margin reached 58.7%. For the fourth quarter, TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center. forecast gross margin of 65% to 67%, with a midpoint of 66%.
Management previously said the N21. TSMC’s 2-nanometer process technologyN2 is the process family whose annual capacity TSMC expects to more than double in 2027.2. 2-nanometer production ramp would dilute gross margin by about 3 to 4 percentage points in the second half of 2026. Overseas wafer-fab production is expected to reduce full-year 2026 gross margin by nearly 2 percentage points, with the impact potentially rising to 3 to 4 percentage points over the next several years as new fabs move through investment and ramp-up phases.
TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center. said pricing adjustments have become central as costs rise and the company seeks to maintain profitability while funding capital expenditures. Pricing must reflect higher costs without eroding the premium attached to advanced processes.
C.C. Wei said TSMCTaiwan Semiconductor Manufacturing CompanyTSMC is named as a founding partner of the EPIC Center. has seen continued growth in CPUcentral processing unitMain processor that executes program instructions and performs data operations. demand linked to agentic AIartificial intelligence, but did not break out the split between AIartificial intelligence accelerators and CPUcentral processing unitMain processor that executes program instructions and performs data operations.s. He added that demand still far exceeds the company’s supply capacity, leaving utilization, ramp timing, and product mix as key variables for the next phase of expansion.