On Wednesday, the stock price of TSMC surged following its announcement the previous day that it would gradually phase out its 6-inch wafer manufacturing business within the next two years. Industry insiders have analyzed that this move by TSMC will have multiple impacts, with the shift of customer orders being the primary challenge. Additionally, TSMC is likely to repurpose its existing land and facilities into advanced packaging plants.
TSMC stated on Tuesday (August 12) that it would phase out its 6-inch wafer manufacturing business over the next two years and continue to consolidate its 8-inch wafer capacity to enhance efficiency. The decision to exit the 6-inch wafer manufacturing business will not affect the previously announced financial targets.
In a statement to Reuters, TSMC indicated that this decision was made after a comprehensive assessment, taking into account market conditions and aligning with the company’s long-term business strategy.
The following day, TSMC’s stock price soared. On Wednesday (August 13), TSMC closed at the day’s highest price of 1,200 New Taiwan dollars (NTD), leading the market to reach a historic high, rising by 20 NTD and pushing its market value to a new peak of 31.12 trillion NTD, contributing over 160 points to the market’s rise.
On Tuesday, TSMC also announced five major resolutions by its board of directors, but notable items such as increased investment in the US, collaboration with Intel Capital, and internal controls following the 2nm leak case were not included.
TSMC’s CEO, Wei Zhejia, stated during a mid-July earnings conference call that due to strong demand in artificial intelligence and the proliferation of its cutting-edge technology, the company expects its revenue in 2025 to grow by approximately 30% in US dollars. From January to July, TSMC’s total revenue amounted to 2.096 trillion NTD, an increase of 37.6% compared to the same period in 2024.
Currently, TSMC operates four 12-inch wafer fabs in Taiwan (all of which are large-scale bases containing multiple phases), four 8-inch wafer fabs, and one 6-inch wafer fab. The total capacity in 2024 (including subsidiaries) is close to 17 million 12-inch wafer equivalents.
Public data shows that the monthly capacity of TSMC’s 6-inch wafer fab is about 83,000 wafers, accounting for less than 0.5% of revenue, with its strategic importance significantly reduced. The fab mainly uses mature processes of 0.45μm and above, producing products such as sensors, analog circuits, and basic power devices widely used in IoT, consumer electronics, and industrial control sectors.
Industry experts point out that this strategic adjustment by TSMC has had various impacts on the industry. Primarily, for customers relying on its 6-inch capacity, the transfer of orders has become a major challenge.
TSMC has provided multiple solutions: some orders may be shifted to its 12-inch production line to leverage economies of scale, while others may be taken over by its subsidiary, UMC, specializing in mature processes to ensure a smooth transition for customers.
Furthermore, this move is an important step for TSMC to optimize its capacity and plan for the future. After exiting the 6-inch manufacturing business, its idle plant land and facilities are likely to be repurposed.
Analysts suggest that TSMC may transform the site into an advanced packaging plant to support its expansion in advanced packaging technologies such as CoWoS and SoIC.