TSMC Increases Spending to $64 Billion Amid AI Chip Boom

Taiwan Semiconductor Manufacturing Company is increasing its annual capital expenditures to between $60 billion and $64 billion, up from $40.9 billion last year, to address capacity shortages driven by the artificial intelligence boom. As the world's largest contract chip manufacturer, the company held 73% of third-party manufacturing spending in the first quarter of 2026, positioning it as the essential partner for nearly all AI accelerators.

While Nvidia remains a central figure in AI infrastructure, market demand is diversifying toward custom silicon. GF Securities identifies Marvell Technology, Intel, and Mediatek as preferred stocks due to the growth of custom AI chips and advanced packaging. Marvell Technology is expected to see billions in revenue by 2028 through partnerships with Google and Amazon's Trainium 3 program.

Intel is also seeing growth in its back-end operations, with GF Securities raising its AI packaging revenue forecasts to $1.1 billion for fiscal 2027 and $7 billion for fiscal 2028. This shift occurs as hyperscale clients seek to reduce capital expenditures by designing their own silicon, though they remain dependent on TSMC's CoWoS capacity and manufacturing services to bring these designs to market.