TSMC and Nvidia Partnership on Blackwell AI Chips
Investing.com — Taiwan Semiconductor Manufacturing (NYSE:TSM) (TSMC) is in discussions with Nvidia Corp (NASDAQ:NVDA) regarding the production of Nvidia's Blackwell AI chips at TSMC's new facility in Arizona, as reported by Reuters.
Key Details
- Production Start: TSMC is preparing to begin production in early 2024.
- Current Production: Nvidia's Blackwell chips, unveiled in March, are currently made at TSMC's facilities in Taiwan and are popular among generative AI and accelerated computing users, offering performance up to 30 times faster for tasks like chatbot responses.
- Client Expansion: If the agreement is finalized, Nvidia would join other clients like Apple (NASDAQ:AAPL) and Advanced Micro Devices (NASDAQ:AMD) at TSMC's Arizona plant, which is set to start large-scale production next year.
- Manufacturing Stages: TSMC will only handle initial manufacturing phases in Arizona, as advanced packaging for the Blackwell chips will take place in Taiwan due to the lack of necessary capabilities at the Arizona site.
Investment and Subsidies
TSMC is investing tens of billions into three new facilities in Phoenix, backed by significant US government subsidies aimed at enhancing domestic semiconductor production. The US Commerce Department confirmed a $6.6 billion subsidy to TSMC’s US division for advanced semiconductor production, along with low-interest loans up to $5 billion. In exchange, TSMC has increased its total project investment to $65 billion and will build a third manufacturing plant in Arizona by 2030.
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