Taiwan Semiconductor Manufacturing Co (TSMC) faces mounting pressure on its profit margins as the cost of manufacturing advanced chips in the United States continues to rise.
The world’s largest foundry is grappling with higher operational expenses linked to its massive onshoring commitments, a direct consequence of sustained political pressure from the Trump administration to localize semiconductor production.
Since President Donald Trump returned to power in 2025, TSMC has announced $200 billion in investments for US manufacturing facilities.
Since President Donald Trump returned to power in 2025, TSMC has announced $200 billion in investments for US manufacturing facilities.
While this capital injection secures the company’s strategic position in the American supply chain, the financial reality of building and operating fabs in the US is proving more expensive than anticipated.
The increased cost base is beginning to erode the margin expansion that has historically accompanied the company’s growth.
This development presents a complex picture for investors.