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Falling Reserves: TSMC raises prices again for foundry customers

Image: TSMC

TSMC’s high spending on research, development and new buildings drain financial reserves. Customers will therefore have to pay more for various processes in the future. At the same time, the payment terms are shortened.

Several Taiwanese media outlets unanimously report that a new pricing round is approaching TSMC and will bring further changes. In the future, Foundry customers will be able to pay their bills in half the time, i.e. 15 days, instead of within 30 days. TSMC is said to have acknowledged with some customers that they have problems with high inventory in a cooling market and have to sell their first products at a much lower price. The company doesn’t want to be the one left with the finished chips.

At the same time, there is talk of a new pricing round. New customers always have to pay adequate and increased prices anyway, but this will also affect some existing customers in the next year. On average, there is currently talk of ten percent, although TSMC never confirms these figures and certainly does not mention names.

high-level expenses

TSMC is currently earning well, but spending is also unmatched. The company intends to invest up to $ 44 billion this year alone, clearly outpacing the performance of much larger companies. Added to this are the increases in the prices of raw materials and almost everything else on the world market. of the free cash flow The most recent of the group fell 23 percent to its lowest level since last summer.

TSMC is not only planning future production with the funds, but more importantly it is building more new factories and is already planning the next ones. In addition to the current locations in Japan and the United States, it is above all the domestic market that is constantly being built. The next mega-project is a fabulous one in the south of the country: phases 1 and 2 are already planned and the inauguration ceremony is scheduled for this month. In the final expansion phase, there could be six phases, as each building complex is called by TSMC. And it is also rumored that TSMC is in talks with the local government in Taichung, another mega-complex could be built there, according to the latest media report, 1 trillion new Taiwan dollars could be spent on this, the equivalent of approximately 32.3 billion euros.

Phase 1 and 2 of the new TSMC Kaohsiung plant
Phase 1 and 2 of the new TSMC Kaohsiung plant (Image: BusinessWire)

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