(Bloomberg) — Taiwan Semiconductor Manufacturing Co. achieved production yields at its Arizona facility on par with established plants back home, an early indicator that its marquee US project is on track to achieve its targets.
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The Taiwanese chipmaker’s yield rate in trial production at its first advanced US plant is similar to comparable facilities in the southern Taiwanese city of Tainan, according to a person familiar with the company, who asked not to be identified discussing private corporate matters. TSMC had said it started engineering wafer production in April with advanced 4-nanometer process technology.
Yield rate, or how many usable chips a company can produce during a single manufacturing process, is a key factor that impacts profitability. While TSMC doesn’t disclose its yield rate, investors are counting on the company’s ability to maintain steady margins. The company has said it can maintain gross margin rates at 53% or higher in the long run, and has kept its net profit steady at above 36% over the past four years.
TSMC said in an email that its Arizona project is “proceeding as planned with good progression,” without commenting on the yield.
The go-to chipmaker for Apple Inc. and Nvidia Corp. originally planned to have its first Arizona plant start full production in 2024, but pushed back the target to 2025 due to a lack of skilled workers. The delay fueled concerns that the company might not be able to make chips in the US as efficiently as in Taiwan.
The US plans to award TSMC $6.6 billion in grants and as much as $5 billion in loans to support the chipmaker’s $65 billion in investments at three plants in Arizona.
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