Taiwan Semiconductor Manufacturing (TSM.US), the world's leading wafer foundry, is evaluating a potential investment in Texas to expand its chip production capacity in the United States, according to a report.
People familiar with the matter said the potential investment would come on top of the US$265 billion TSMC has already committed to its Arizona operations, and that the plans have not yet been finalized.
Citing sources in the semiconductor equipment supply chain, Taiwanese media reported that TSMC is assessing a second large-scale manufacturing campus in the United States that would include up to six additional advanced wafer fabs, with Dallas and the wider North Texas region seen as the likely location and the investment size potentially exceeding that of its Arizona site.
The choice of Texas is no accident. Dallas and North Texas, long known as "Silicon Prairie," have developed a mature cluster of semiconductor manufacturing, silicon wafer supply chains, optical communications and defense industries, with major players such as Texas Instruments, Samsung, Coherent and Tesla all operating facilities in the area. Wells Fargo analyst Joe Quatrochi noted that the region already hosts multiple operating fabs, making it a reasonable site for TSMC's second campus. In addition, Texas offers advantages in land, energy and talent that are attractive for power-hungry advanced fabs.
From a strategic perspective, 2-nanometer capacity expansion is an important highlight. TSMC's 2nm process began contributing initial revenue in the second quarter of 2026, with major customers including Apple, NVIDIA, AMD and Qualcomm. As key customers increase orders by 10% to 20%, TSMC is accelerating its expansion, with monthly 2nm capacity potentially reaching 120,000 wafers by the end of the year, above earlier market estimates of 90,000 to 100,000 wafers, meaning the capacity level originally targeted for 2027 could be reached ahead of schedule. Quatrochi said that if the expansion materializes, it should be viewed as a potential incremental positive for semiconductor equipment companies.
Customer demand and policy pressure together form the twin drivers behind TSMC's stepped-up U.S. manufacturing push. In the first half of 2026, U.S. customers accounted for about 75.64% of TSMC's revenue. At the same time, the Trump administration has continued to pressure chipmakers to move production back to the United States, threatening tariffs of up to 200% on companies that do not build plants there, further pushing TSMC to expand its U.S. footprint.
In terms of market impact, if TSMC launches a second Texas campus, it would link Arizona wafer manufacturing with Texas's advanced ecosystem, forming a two-major-manufacturing-base structure in the United States and benefiting the semiconductor equipment supply chain. However, the specific plans for the six fabs, the investment amount and the process nodes have not been officially confirmed, and supply chain players believe the site evaluation is nearing completion but the TSMC board has not yet made a final decision.
TSMC announced in July an additional US$100 billion investment in Arizona, bringing its total planned investment there to US$265 billion. The expansion is expected to add four semiconductor manufacturing and packaging facilities, bringing its total number of U.S. facilities to 12. TSMC's first U.S. chip plant, located in Phoenix, began mass production of 4nm chips at the end of 2024. Its second factory is expected to start producing more advanced 3nm chips in the second half of next year.