TSMC's Kumamoto unit fab swings to profit in Q1

Taipei, May 16 (CNA) The subsidiary of Taiwan Semiconductor Manufacturing Co. (TSMC) in Kumamoto, Japan, turned a profit in the first quarter of this year, marking the first time the first fab of the unit become profitable since mass production started at the end of 2024.

According to contract chipmaker TSMC's financial statement released on Friday, Japan Advanced Semiconductor Manufacturing Inc. (JASM), a joint venture running the fab in Kumamoto, posted NT$951 million (US$30.19 million) in profit in the January-March period, compared with a loss of NT$1.39 billion in the previous quarter, and a loss of NT$3.25 billion in the first quarter of 2025.

Market analysts said the latest financial report from the first Kumamoto fab showed an improving production utilization.

The first Kumamoto fab uses mature processes, including 12-, 16-, 22-, and 28-nanometer processes, for the automotive and industrial sectors, according to TSMC.

In addition to the first fab, JASM, in which TSMC owns a 77 percent stake, has started construction of the second fab in Kumamoto.

Previously, the second Kumamoto fab would use the 6nm process, but the plan has been adjusted since February to use the advanced 3nm process in response to strong global AI demand.

In the United States, TSMC's wholly owned subsidiary TSMC Arizona, posted NT$18.81 billion in profit in the first quarter, up from NT$11.37 billion in the previous quarter, and up sharply from NT$496 million over the same period of last year.

According to TSMC, the Arizona subsidiary's first quarter profit even surpassed the NT$16.14 billion recorded for the entire 2025.

Analysts said the Arizona fab benefited from the current AI boom, catering to its major clients in the U.S. market.

TSMC's first fab in Arizona started mass production in the fourth quarter of 2024, using the 4nm process. The second fab is slated to begin commercial production in the second half of 2027, using the 3nm process.

Construction of the third fab in Arizona has started, while the chipmaker has filed applications to build the fourth fab, and the first IC assembly plant in the U.S. state.

TSMC has planned to spend US$165 billion to build six advanced fabs, two IC assembly plants, and a research and development center in Arizona.

In Dresden, Germany, European Semiconductor Manufacturing Co. (ESMC), in which TSMC owns a 70 percent stake, incurred NT$278 million in losses in the first quarter, with construction of a fab still underway.

According to TSMC, it received NT$505 million in subsidies from the governments of the U.S., Japan and Germany for its investments in these countries in the first quarter, falling sharply by 98.56 percent from a year earlier.

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