Taiwan Semiconductor Manufacturing Co (ADR), the world's largest contract chipmaker, now expects the global semiconductor
market to exceed $1.5 trillion by 2030, a 50% upgrade on its previous forecast of $1 trillion, driven by surging demand for artificial intelligence and high-performance computing. The Taiwanese company set out the revised outlook in presentation materials ahead of its annual technology symposium on Thursday. AI and high-performance computing (HPC) are expected to account for 55% of the $1.5 trillion market, equivalent to roughly $825 billion, followed by smartphones at 20% and automotive applications at 10%. Demand for AI accelerator wafers alone is projected to increase 11-fold between 2022 and 2026. To meet the surge, TSMC said it had been expanding capacity at a faster pace in 2025 and 2026, with plans to build nine phases of wafer fabrication plants and advanced packaging facilities this year. Capacity for its most advanced chips, the 2-nanometre node and the next-generation A16, is projected to grow at a compound annual rate of 70% from 2026 to 2028. Capacity for CoWoS (chip on wafer on substrate), a key packaging technology widely used in AI processors including those designed by Nvidia, is forecast to grow at a compound annual rate of more than 80% from 2022 to 2027. TSMC is also rapidly scaling its overseas manufacturing footprint. In Arizona, the first fabrication plant is already in production, with tool installation for the second fab planned for the second half of this year and construction of a third underway. Work on a fourth fab and the site's first advanced packaging facility is expected to begin in 2026, and TSMC said it had completed the purchase of a second large parcel of land in the state for future expansion. Output from the Arizona campus is expected to nearly double year on year in 2026, with yields comparable to those at TSMC's home facilities in Taiwan. In Japan, the first fab is in volume production for older chip technologies, and plans for the second have been upgraded to the more advanced 3-nanometre process in response to strong demand. A fab in Germany is under construction and progressing on schedule.
