TSMC facts for kids

Quick facts for kids
Taiwan Semiconductor Manufacturing Company Limited

One of TSMC's factories in Taichung's Central Taiwan Science Park
Native name	台積電
Type	Public company
Traded as	TWSE: 2330 NYSE: TSM LSE: OLCV
ISIN	ISIN: [https://isin.toolforge.org/?language=en&isin=US8740391003 US8740391003]
Industry	Semiconductors
Founded	Industrial Technology Research Institute, Hsinchu, Taiwan (21 February 1987; 38 years ago (1987-02-21))
Founder	Morris Chang
Headquarters	Hsinchu Science Park , Taiwan
Area served	Worldwide
Key people	Mark Liu (Chairman) Che Chia Wei (CEO and vice-chairman)
Production output	15 million 12-inch equivalent wafers (2022)
Services	Manufacture of integrated circuits mask services integrated circuits packaging multi wafer foundry services
Revenue	US$71.28 billion (2023)
Operating income	US$36.49 billion (2022)
Net income	US$27.67 billion (2023)
Total assets	US$161.6 billion (2022)
Total equity	US$94.95 billion (2022)
Number of employees	73,090 (2022)
Divisions	SSMC (38.8% joint venture with NXP)
Subsidiaries	WaferTech TSMC Nanjing Company Ltd. JASM
Chinese name
Traditional Chinese	台灣積體電路製造股份有限公司
Transcriptions Standard Mandarin Hanyu Pinyin Táiwān Jītǐ Diànlù Zhìzào Gǔfèn Yǒuxiàn Gōngsī Bopomofo ㄊㄞˊ ㄨㄢ ㄐㄧ ㄊㄧˇ ㄉㄧㄢˋ ㄌㄨˋ ㄓˋ ㄗㄠˋ ㄍㄨˇ ㄈㄣˋ ㄧㄡˇ ㄒㄧㄢˋ ㄍㄨㄥ ㄙ Wade–Giles T'ai2-wan1 Chi1-t'i3 Tien4-lu4 Chih4-tsao4 Ku3-fen4 You3-hsien4 Kung1-ssŭ1 Southern Min Hokkien POJ Tâi-oân chek-thé tiān-lō͘ chè-chō kó͘-hūn iú-hān Kong-sī Tâi-lô Tâi-uân tsik-thé tiān-lōo tsè-tsō kóo-hūn iú-hān kong-si
Abbreviation
Traditional Chinese	台積電
Transcriptions Standard Mandarin Hanyu Pinyin Tái Jī Diàn Wade–Giles T'ai2 Chi1 Tien4 Southern Min Hokkien POJ Tâi-chek-tiān Tâi-lô Tâi-tsik-tiān

Taiwan Semiconductor Manufacturing Company Limited (TSMC), also known as Taiwan Semiconductor, is a huge company from Taiwan. They make tiny electronic parts called semiconductors. These parts are like the brains of all our electronic gadgets, from smartphones to computers. TSMC is one of the biggest and most important companies in the world for making these parts. It's the largest company in Taiwan and has its main offices in the Hsinchu Science Park in Hsinchu, Taiwan.

Many foreign investors own most of TSMC. The government of Taiwan is also a very big shareholder. In 2023, Forbes magazine ranked TSMC as the 44th largest company in the world. Taiwan's sales of these electronic parts were about $184 billion in 2022. This amount made up almost a quarter of Taiwan's total economy! TSMC alone makes up about 30% of Taiwan's main stock market index.

TSMC was started in Taiwan in 1987 by Morris Chang. It was the first company ever to focus only on making chips for other companies. This is called a "dedicated semiconductor foundry." TSMC has been a leader in this field for a long time. Morris Chang retired in 2018 after leading TSMC for 31 years. Now, Mark Liu is the chairman and C. C. Wei is the CEO. TSMC's shares have been traded on the Taiwan Stock Exchange since 1993. In 1997, it became the first Taiwanese company to be listed on the New York Stock Exchange.

Many well-known technology companies, like Apple, AMD, Nvidia, and Qualcomm, are customers of TSMC. Even some companies that make their own chips, like Intel, sometimes ask TSMC to make some of their products. This shows how important TSMC is in the world of electronics.

As of 2020, TSMC can make about 13 million large electronic wafers each year. They can make chips using very advanced technologies, from 2 microns down to 3 nanometres. TSMC was the first company to offer 7-nanometre and 5-nanometre production. These are super tiny and powerful chips used in devices like the Apple A14 and M1 chips found in iPhones and Macs. They were also the first to use a special technology called extreme ultraviolet (EUV) lithography for making chips in large amounts.

How TSMC Started

In 1986, a government official from Taiwan, Li Kwoh-ting, asked Morris Chang to help build Taiwan's chip industry. At that time, it was hard to find investors because making chips needed a lot of money and had high risks.

• Only Philips company agreed to work with Taiwan. They invested $58 million and shared their technology.
• The Taiwanese government also invested a lot of money, about 48% of the starting capital.
• Wealthy families in Taiwan were also asked by the government to invest.
• So, from the very beginning, TSMC was a big project supported by the Taiwanese government.

The company has continued to grow a lot over the years. In 2011, TSMC planned to spend almost 39% more on research and development to stay ahead of other companies. They also wanted to make 30% more chips to meet the high demand.

Making Chips for Big Companies

TSMC has been a key partner for many major tech companies.

• In 2011, TSMC started making chips for Apple's iPad and iPhone devices.
• By 2014, Apple was TSMC's most important customer.
• In October 2014, ARM and TSMC made a deal to work together on new 10-nanometre processors.

Caring for the Environment

In 2020, TSMC became the first chip company to promise to use 100% renewable energy by 2050. This is a big deal because TSMC uses about 5% of all the energy in Taiwan, which is more than the capital city, Taipei! This promise is expected to help Taiwan switch to more green energy.

TSMC's Growth and Value

TSMC has grown a lot over the years.

• In 2020, TSMC earned $17.60 billion in profit from sales of $45.51 billion. This was a big jump from 2019.
• By April 2021, the company was worth over $550 billion.
• In March 2017, TSMC's market value became higher than that of Intel, another giant in the semiconductor world.
• In June 2020, TSMC briefly became the 10th most valuable company in the world.

Expanding Around the World

Because of worries about possible conflicts between Taiwan and China, TSMC has started building more factories outside of Taiwan.

• They are building new factories in Japan and the United States.
• They also plan to expand into Germany.
• In July 2020, TSMC stopped shipping chips to a Chinese company called Huawei and its part, HiSilicon.

Factories in Arizona

In November 2020, TSMC announced plans to build a $12 billion chip factory in Phoenix, Arizona in the United States.

• This decision came after the US government expressed concerns about too many electronics being made outside the US.
• The factory is expected to start making chips by 2024.
• It will use TSMC's advanced 5-nanometre technology, making it the most advanced chip factory in the United States when it opens.
• TSMC plans to invest $12 billion over eight years and create 1,900 full-time jobs.
• In December 2022, TSMC announced they would triple their investment in Arizona.
• However, building factories in the US is much more expensive than in Taiwan. It costs four to five times more due to higher labor costs and training.
• TSMC has also faced challenges finding enough skilled workers in the US. They have sent US workers to Taiwan for training.
• In April 2024, the US government agreed to give TSMC $6.6 billion in funding and up to $5 billion in loans to help build these factories. This is part of the CHIPS and Science Act to boost chip production in the USA.

Factories in Germany

In August 2023, TSMC announced plans for a factory in Dresden, Germany.

• TSMC will invest 3.5 billion Euros in this factory.
• Other companies like Robert Bosch GmbH, Infineon Technologies, and NXP Semiconductors will also be part of this project.
• The German government will provide a 5 billion Euro subsidy.

WaferTech Subsidiary

WaferTech is a company owned by TSMC, located in Camas, Washington, near Portland, Oregon, in the United States.

• It's a "pure-play semiconductor foundry," meaning it only makes chips for other companies.
• The factory is quite large, covering about 12,000 square meters.
• It's the second-largest pure-play foundry in the US and employs 1,100 workers.
• WaferTech makes chips using older but still important technologies, like 0.35 to 0.16 micrometers.

WaferTech's History

• WaferTech started in June 1996 as a joint project with TSMC and other companies like Altera and Analog Devices.
• They invested $1.2 billion, which was the biggest startup investment in Washington state at the time.
• Production began in July 1998.
• In 2000, TSMC bought out its partners and took full control of WaferTech.

How TSMC Makes Chips

TSMC uses very advanced technologies to make chips. The smaller the "nanometre" number, the more advanced and powerful the chip.

• N7+ was the first technology to use a special light called extreme-ultraviolet (EUV) light. This allows them to make even tinier circuits. N7+ chips are 15-20% denser and use 10% less power than older ones.
• N5 technology can double the number of tiny parts (transistors) on a chip and make it 15% faster.
• TSMC is always working on newer technologies, like 4-nanometre and 3-nanometre chips. They plan to start making 2-nanometre chips in 2025.

The NVIDIA GeForce GTX 1070 uses a chip made by TSMC with its 16 nm technology.

TSMC makes chips on large, round slices of silicon called "wafers." They can make chips with different sizes of tiny features, called "node sizes":

• From 0.13 micrometers (older, larger chips)
• To 3 nanometres (very new, tiny, and powerful chips).

They also help customers design their chips to work best with TSMC's manufacturing process.

Where TSMC Has Factories

TSMC has many factories, called "fabs," around the world. Most of them are in Taiwan.

Who Owns TSMC?

Many different groups and people own parts of TSMC.

• About 56% of TSMC's shares are owned by the general public.
• About 38% are owned by large organizations like investment funds.
• The largest shareholder is the National Development Fund of Taiwan's government.
• Other big owners include major investment companies like BlackRock and Capital Research.

Images for kids

• 

  Fab 21 under construction in Phoenix, Arizona in November 2023

See Also