Taiwan Semiconductor Manufacturing Company ( TSMC ) has said that the U.S. tariffs were having some effect on its business, but strong demand for artificial intelligence (AI) chips continues to outpace supply. Speaking at the company’s annual shareholders meeting in Hsinchu, Chief Executive C.C. Wei said the issue of tariffs had been discussed with U.S. officials. However, he stressed that TSMC had not seen any major changes in customer behavior so far.
"Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters. TSMC is an exporter. However, tariffs can lead to slightly higher prices, and when prices go up, demand may go down," Wei explained.
"If demand drops, TSMC's business could be affected. But I can assure you that AI demand has always been very strong and it's consistently outpacing supply."
TSMC committed $165 billion to build factories in US
TSMC, a major supplier to tech giants like Apple and Nvidia, has been caught in the crosshairs of global trade tensions driven by U.S. policy. The company has committed $165 billion to build new factories in the U.S., but some of the equipment it uses is made in Asia, raising concerns over added costs due to tariffs.
"The U.S. commerce department said this is open for discussion, but how long that will take remains unclear," Wei said.
"The real point is that we are in active communication, because only through understanding can they realise the consequences."
Wei also recalled a conversation with President Donald Trump , during which he raised concerns about meeting investment deadlines.
"He said, 'Mr Wei, do your best, that's good enough.'"
TSMC CEO denies rumours of setting up plants in Middle East
Addressing rumors about TSMC setting up chip plants in the Middle East, Wei said the company had no such plans.
"It's not very likely we will have customers there," he stated.
On the domestic front, Wei noted that a stronger Taiwan dollar has hurt the company's profitability.
"The currency appreciation reduced our gross margin by more than 3 percentage points," he said.
TSMC also faces geopolitical challenges, particularly rising tensions between China and Taiwan. Wei acknowledged these risks but said such matters are beyond the company’s control.
"If something happens that we don't want to happen, it's a matter for governments, not for TSMC alone," he said.
Despite these concerns, TSMC remains optimistic about its outlook, especially with strong AI-related chip demand driving growth.
"Tariffs do have some impact on TSMC, but not directly. That's because tariffs are imposed on importers, not exporters. TSMC is an exporter. However, tariffs can lead to slightly higher prices, and when prices go up, demand may go down," Wei explained.
"If demand drops, TSMC's business could be affected. But I can assure you that AI demand has always been very strong and it's consistently outpacing supply."
TSMC committed $165 billion to build factories in US
TSMC, a major supplier to tech giants like Apple and Nvidia, has been caught in the crosshairs of global trade tensions driven by U.S. policy. The company has committed $165 billion to build new factories in the U.S., but some of the equipment it uses is made in Asia, raising concerns over added costs due to tariffs.
"The U.S. commerce department said this is open for discussion, but how long that will take remains unclear," Wei said.
"The real point is that we are in active communication, because only through understanding can they realise the consequences."
Wei also recalled a conversation with President Donald Trump , during which he raised concerns about meeting investment deadlines.
"He said, 'Mr Wei, do your best, that's good enough.'"
TSMC CEO denies rumours of setting up plants in Middle East
Addressing rumors about TSMC setting up chip plants in the Middle East, Wei said the company had no such plans.
"It's not very likely we will have customers there," he stated.
On the domestic front, Wei noted that a stronger Taiwan dollar has hurt the company's profitability.
"The currency appreciation reduced our gross margin by more than 3 percentage points," he said.
TSMC also faces geopolitical challenges, particularly rising tensions between China and Taiwan. Wei acknowledged these risks but said such matters are beyond the company’s control.
"If something happens that we don't want to happen, it's a matter for governments, not for TSMC alone," he said.
Despite these concerns, TSMC remains optimistic about its outlook, especially with strong AI-related chip demand driving growth.
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