TSMC(US:TSM) Guan Cha Zhe Wang·2025-04-28 00:38Core Viewpoint - TSMC is facing unprecedented strategic choices amid the US-China tech rivalry, with significant implications for its operations and investments in the US [1] Group 1: Financial Performance and Investments - TSMC's Arizona factory reported a loss of approximately 32.1 billion RMB, marking it as the largest loss among its overseas facilities [2] - The company plans to invest an additional $100 billion in Arizona, bringing total investments to $165 billion, which may reduce the factory's gross margin by five percentage points over five years [2] - The Arizona facility has been losing nearly 4 billion NTD annually since 2021, with cumulative losses approaching 40 billion NTD, raising concerns among shareholders [4] Group 2: Production Capacity and Technology - TSMC's first Arizona factory has achieved N4 mass production, while the second factory is under construction and will utilize N3 technology [2] - The Arizona facility aims to have 30% of its future capacity above 2nm, with plans for two advanced packaging facilities and one R&D center [2] - The R&D center will employ over 1,000 engineers focused on optimizing overseas production processes rather than cutting-edge research [2] Group 3: Market Dynamics and Regional Revenue - In 2024, North America accounted for 77% of TSMC's revenue, a 9 percentage point increase year-on-year, while revenue from mainland China dropped to 7% [7] - The revenue distribution reflects the dominance of US clients like Apple, Nvidia, and AMD, which contribute significantly to TSMC's earnings [9] - The growth rate of chip design companies in mainland China fell below the global average for the first time in four years, primarily due to the leading position of US firms in HPC/AI accelerator chips [10]