Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) plans to allocate a larger portion, or about 9 percent, of its total revenue this year to research and development (R&D) on cutting-edge technologies to safeguard its technological lead amid intensifying competition, the chipmaker’s annual report said.
That could bring TSMC’s R&D budget to more than NT$110 billion (US$3.65 billion) if it reaches its goal of growing revenue by more than 15 percent annually this year — to at least NT$1.23 trillion.
This year’s spending would be a 20 percent increase over last year’s record-high R&D expenditure of NT$91.42 billion.
Photo: EPA-EFE
The bulk, or 70 percent, of this year’s R&D budget is to be spent on advanced technologies, including the 3 nanometer (nm) technology platform and applications, next-generation technologies and 3D IC for system-in-package modules, the report said.
TSMC, a pioneer in the semiconductor industry, said that it began R&D on 2nm technology last year, as it targets 5G-related applications and high-performance-computing devices.
“To maintain and strengthen TSMC’s technology leadership, the company plans to continue investing heavily in R&D,” the report said.
“The markets for TSMC’s foundry services are highly competitive. TSMC competes with other foundry service providers, as well as with a number of integrated device manufacturers,” the company said, referring to the competition it faces.
If TSMC is unable to effectively take on these new and aggressive competitors when it comes to technology, manufacturing capacity, product quality and customer satisfaction, it risks losing customers to these new contenders, the report said.
TSMC, which commands a 52 percent share of the world’s foundry market, competes primarily with Samsung Electronics Co for advanced technology orders, while its Chinese rival Semiconductor Manufacturing International Corp (SMIC, 中芯) is positioning itself to take a bite out of TSMC’s share in China.
TSMC last week said that it plans to increase production of 3nm technology in the second half of 2022, which would make it the foremost foundry offering the technology.
The chipmaker’s report also warned of possible negative effects resulting from the COVID-19 pandemic, saying that the coronavirus might interrupt the global semiconductor supply chain and disrupt some of its suppliers.
There could be downward adjustments in customer demand or production delays for TSMC products, due to forced closures, or partial operations, at factories and offices, the report said.
Due to fallout from the pandemic, the chipmaker expects the global semiconductor industry to see stagnant revenue this year, at best, it said, adding that the industry is expected to grow at a compound annual growth rate of 5 percent between last year and 2024.
The chipmaker also disclosed that company chairman Mark Liu (劉德音) and CEO C.C. Wei (魏哲家) received NT$293 million in compensation apiece last year, accounting for 0.085 percent of net profits last year, the report showed.
Last year, the company paid NT$1.545 billion in compensation to its high-ranking executives.
Hon Hai Precision Industry Co (鴻海精密) yesterday said that its research institute has launched its first advanced artificial intelligence (AI) large language model (LLM) using traditional Chinese, with technology assistance from Nvidia Corp. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), said the LLM, FoxBrain, is expected to improve its data analysis capabilities for smart manufacturing, and electric vehicle and smart city development. An LLM is a type of AI trained on vast amounts of text data and uses deep learning techniques, particularly neural networks, to process and generate language. They are essential for building and improving AI-powered servers. Nvidia provided assistance
GREAT SUCCESS: Republican Senator Todd Young expressed surprise at Trump’s comments and said he expects the administration to keep the program running US lawmakers who helped secure billions of dollars in subsidies for domestic semiconductor manufacturing rejected US President Donald Trump’s call to revoke the 2022 CHIPS and Science Act, signaling that any repeal effort in the US Congress would fall short. US Senate Minority Leader Chuck Schumer, who negotiated the law, on Wednesday said that Trump’s demand would fail, while a top Republican proponent, US Senator Todd Young, expressed surprise at the president’s comments and said he expects the administration to keep the program running. The CHIPS Act is “essential for America leading the world in tech, leading the world in AI [artificial
DOMESTIC SUPPLY: The probe comes as Donald Trump has called for the repeal of the US$52.7 billion CHIPS and Science Act, which the US Congress passed in 2022 The Office of the US Trade Representative is to hold a hearing tomorrow into older Chinese-made “legacy” semiconductors that could heap more US tariffs on chips from China that power everyday goods from cars to washing machines to telecoms equipment. The probe, which began during former US president Joe Biden’s tenure in December last year, aims to protect US and other semiconductor producers from China’s massive state-driven buildup of domestic chip supply. A 50 percent US tariff on Chinese semiconductors began on Jan. 1. Legacy chips use older manufacturing processes introduced more than a decade ago and are often far simpler than
Gasoline and diesel prices this week are to decrease NT$0.5 and NT$1 per liter respectively as international crude prices continued to fall last week, CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. Effective today, gasoline prices at CPC and Formosa stations are to decrease to NT$29.2, NT$30.7 and NT$32.7 per liter for 92, 95 and 98-octane unleaded gasoline respectively, while premium diesel is to cost NT$27.9 per liter at CPC stations and NT$27.7 at Formosa pumps, the companies said in separate statements. Global crude oil prices dropped last week after the eight OPEC+ members said they would
RSS