# TSMC

> The factory that makes the world's most advanced chips for everyone else.

- Level: Intermediate
- Topics: Tech companies, Hardware
- URL: https://tidbit.legios.com.ar/tsmc/
- In Spanish: [TSMC](https://tidbit.legios.com.ar/es/tsmc/)

**TSMC** (Taiwan Semiconductor Manufacturing Company) manufactures chips for other companies and sells none under its own name. Apple designs the chip in your iPhone, NVIDIA designs the GPU in an AI data center, AMD designs its CPUs, and all of them send those designs to TSMC, which fabricates them in its factories (**fabs**) in Taiwan. A company that only manufactures is called a **foundry**, and TSMC invented the model in 1987 under its founder Morris Chang.

What makes it matter is that it is the best at it. Making a modern chip means printing billions of transistors a few nanometers wide onto silicon wafers, in a process with hundreds of steps and machines (from the Dutch company ASML) that cost hundreds of millions each. Only a handful of companies can do it at the leading edge (Samsung and Intel are the others), and TSMC has led for years: nearly every cutting-edge AI and smartphone chip is made there.

That concentration is a global risk. Most of the world's most advanced chips come from a few fabs on one island that China claims as its territory. Governments noticed: the United States, Japan and Germany have subsidized TSMC fabs on their own soil (Arizona, Kumamoto, Dresden), and 'chip sovereignty' became policy. Export controls on which chips may be sold to China run partly through what TSMC is allowed to make for whom.

Why you hear about it: when NVIDIA cannot ship enough GPUs, when Apple announces a new iPhone chip, or when a '2-nanometer' process is in the news, TSMC is the factory behind it. Its capacity, more than any single design, sets the ceiling on how much AI hardware exists in a given year.

## An analogy

The world's finest printing press, owned by one company. Authors (Apple, NVIDIA, AMD) write the books; TSMC is the only press that can print them at that resolution, so everyone lines up at its door.

## Keep in mind

- A pure foundry: manufactures chips designed by others, never its own brand.
- Makes the most advanced chips for Apple, NVIDIA, AMD, Qualcomm and many more.
- Based in Taiwan, which makes it a geopolitical concern; new fabs in the US, Japan and Germany.
- Its capacity is a bottleneck for the whole AI industry.

## Go deeper

- [tsmc.com](https://www.tsmc.com)
- [TSMC on Wikipedia](https://en.wikipedia.org/wiki/TSMC)
- [Semiconductor fabrication plant on Wikipedia](https://en.wikipedia.org/wiki/Semiconductor_fabrication_plant)

## Related terms

- [Chip](https://tidbit.legios.com.ar/semiconductor-chip/): A sliver of silicon carrying billions of tiny switches that compute and remember.
- [Apple](https://tidbit.legios.com.ar/apple/): The company that sells the iPhone and the Mac, plus the services that run on them.
- [NVIDIA](https://tidbit.legios.com.ar/nvidia/): The company that sells the shovels of the AI gold rush.
- [GPU](https://tidbit.legios.com.ar/gpu/): The chip that does thousands of simple calculations at once.
- [Artificial intelligence](https://tidbit.legios.com.ar/artificial-intelligence/): Getting computers to do things that, until recently, only people could do.
- [Data center](https://tidbit.legios.com.ar/data-center/): A building full of servers where the internet, the cloud and AI actually run.
- [AMD](https://tidbit.legios.com.ar/amd/): The chip designer that competes with Intel in CPUs and with NVIDIA in GPUs.
- [CPU](https://tidbit.legios.com.ar/cpu/): The chip that runs your programs, one instruction after another, very fast.