TSMC Board of Directors Meeting Resolutions Q4 2024

[Daniel Nenni]

HSINCHU, Taiwan, R.O.C., Nov. 12, 2024 – The TSMC (TWSE: 2330, NYSE: TSM) Board of Directors today held a meeting, which passed the following resolutions:

1. Approved the 2024 third quarter Business Report and Financial Statements. Third quarter consolidated revenue totaled NT$759.69 billion and net income was NT$325.26 billion, with diluted earnings per share of NT$12.54.

2. Approved the distribution of a NT$4.50 per share cash dividend for the third quarter of 2024, and set March 24, 2025 as the record date for common stock shareholders entitled to participate in this cash dividend distribution, and the ex-dividend date for the common shares shall be March 18, 2025. As required by Article 165 of Taiwan’s Company Law, the shareholders’ register shall be closed for five days prior to the record date (March 20 through March 24, 2025) for registration transfer, and the dividend will be paid on April 10, 2025. In addition, the ex-dividend date and the record date for entitlement to participate in this cash dividend distribution for TSMC American Depositary Shares (ADSs) will be March 18, 2025.

3. To meet long-term capacity plans based on market demand forecasts and TSMC’s technology development roadmap, the Board approved capital appropriations of approximately US$15,479.95 million for purposes including: 1) Fab construction, and installation of fab facility systems; 2) Installation of advanced technology capacity, as well as 2025 R&D capital investments and sustaining capital expenditures; 3) 2025 capitalized leased assets.

4. Approved the issuance of unsecured corporate bonds in multiple offerings in the domestic market in an amount not to exceed NT$60 billion to finance TSMC’s capacity expansion and/or pollution prevention related expenditures.

TSMC Spokesperson​

Wendell Huang
Senior Vice President & Chief Financial Officer
Tel:886-3-5055901

TSMC Deputy Spokesperson​

Nina Kao
Public Relations Division
Tel:886-3-5636688 Ext.7125036

 

[Daniel Nenni]

That's a pretty big CAPEX cut. Semiconductor equipment companies are going to feel it, only $4.3B for new node equipment and R&D? My guess would be that TSMC has enough capacity for N3 and above and will build N2.

 

[Barnsley]

That's a pretty big CAPEX cut. Semiconductor equipment companies are going to feel it, only $4.3B for new node equipment and R&D? My guess would be that TSMC has enough capacity for N3 and above and will build N2.

Thought there was going to be a rise in 2025 globally for Equipment.

If TSMC not driving that growth , who is?

 

[hist78]

That's a pretty big CAPEX cut. Semiconductor equipment companies are going to feel it, only $4.3B for new node equipment and R&D? My guess would be that TSMC has enough capacity for N3 and above and will build N2.

The money described in the news release is for 2025, but it doesn't mean it will be the total amount for the 2025. TSMC's board of directors always approves spending by multiple batches throughout the year.

 

[Daniel Nenni]

The money described in the news release is for 2025, but it doesn't mean it will be the total amount for the 2025. TSMC's board of directors always approves spending by multiple batches throughout the year.

True but it is a sizable decrease from a quarter ago. I think it is just a pause but other foundries are pausing as well so this could be a problem for the equipment industry (WFE spending).

The $4.3B does not include specialty nodes or packaging which is a bit of a surprise. We will see what the TSMC 2025 CAPEX is but this could be a sign that it will be flat as I suspected.

I think Samsung will be the biggest foundry CAPEX drop in 2025 but Intel may surprise us as well.

 

[hasty2333]

True but it is a sizable decrease from a quarter ago. I think it is just a pause but other foundries are pausing as well so this could be a problem for the equipment industry (WFE spending).

The $4.3B does not include specialty nodes or packaging which is a bit of a surprise. We will see what the TSMC 2025 CAPEX is but this could be a sign that it will be flat as I suspected.

I think Samsung will be the biggest foundry CAPEX drop in 2025 but Intel may surprise us as well.

Is it possible that TSMC is considering whether to make a decision to invest in a core shift? At the very least, further diversifying its R&D focus and manufacture outside of Taiwan. Their financial and energy support is too limited compared to the US. Furthermore, Trump may even charge ‘protection money’ in the form of tariffs if TSMC does not make this move.

 

[hist78]

That's a pretty big CAPEX cut. Semiconductor equipment companies are going to feel it, only $4.3B for new node equipment and R&D? My guess would be that TSMC has enough capacity for N3 and above and will build N2.

It's hard to tell and too early to tell because this batch includes partial 2024 and partial 2025 Capex. The previous batch was approved in the August board meeting purely for using in the 2024. TSMC's Capex spending is not necessarily distributed evenly across all four quarters.

 

[Daniel Nenni]

Is it possible that TSMC is considering whether to make a decision to invest in a core shift? At the very least, further diversifying its R&D focus and manufacture outside of Taiwan. Their financial and energy support is too limited compared to the US. Furthermore, Trump may even charge ‘protection money’ in the form of tariffs if TSMC does not make this move.

TSMC is making some very smart business decisions.

TSMC AZ was announced in 2020 in a $200M+ subsidy partnership with the AZ state government for a $20B fab. The CHIPs Act was announced in 2021 and TSMC now has a signed agreement with the DoC for an additional $8B in subsidies for two AZ fabs ($40B).

The TSMC (22/28nm) fab in Japan cost around $8.5B with about $4B in subsidies from Japan and Sony.

The TSMC (22/28nm) fab in Dresden Germany is projected to cost $11B with $5B in government subsidies. This fab is a joint venture between TSMC, Bosch, Infineon, and NXP, with TSMC holding a majority stake of about 70%.

TSMC does not receive direct government subsidies specifically for building fabs within Taiwan. Instead, TSMC benefits from indirect government support through policies, infrastructure investments, and incentives that foster a robust semiconductor ecosystem in Taiwan. Taiwan also offers favorable tax policies and incentives including tax deductions for R&D expenses and tax breaks for equipment and facility upgrades.

I have no idea how much TSMC has gotten from the Taiwan government over the years but it is substantial. I would bet it will be even more now that TSMC has other bidders for fabs.

 

[hist78]

TSMC is making some very smart business decisions.

TSMC AZ was announced in 2020 in a $200M+ subsidy partnership with the AZ state government for a $20B fab. The CHIPs Act was announced in 2021 and TSMC now has a signed agreement with the DoC for an additional $8B in subsidies for two AZ fabs ($40B).

The TSMC (22/28nm) fab in Japan cost around $8.5B with about $4B in subsidies from Japan and Sony.

The TSMC (22/28nm) fab in Dresden Germany is projected to cost $11B with $5B in government subsidies. This fab is a joint venture between TSMC, Bosch, Infineon, and NXP, with TSMC holding a majority stake of about 70%.

TSMC does not receive direct government subsidies specifically for building fabs within Taiwan. Instead, TSMC benefits from indirect government support through policies, infrastructure investments, and incentives that foster a robust semiconductor ecosystem in Taiwan. Taiwan also offers favorable tax policies and incentives including tax deductions for R&D expenses and tax breaks for equipment and facility upgrades.

I have no idea how much TSMC has gotten from the Taiwan government over the years but it is substantial. I would bet it will be even more now that TSMC has other bidders for fabs.

"The TSMC (22/28nm) fab in Japan cost around $8.5B with about $4B in subsidies from Japan and Sony."

The subsidy is from Japanese government, not Sony. TSMC, Sony, DENSO and Toyota are partners in the JASM (TSMC Japan). Each of them holds equity stakes approximately TSMC (86.5%), Sony (6.0%), DENSO (5.5%), and Toyota (2.0%) in JASM.

Among them, Sony in the largest image sensor vendors in the world, DENSO is ranked number 2 of the largest automotive parts suppliers in the world, and Toyota is the world largest automaker.

In Germany, the ESMC (TSMC Germany) has TSMC (holds 70% equity of ESMC), Infineon (10% of ESMC), NXP (10% of ESMC), and Bosch (10% of ESMC).

Infineon is the global number one supplier in automotive microcontrollers, BOSCH is the world largest automotive parts supplier, and NXP is strong in automotive, IoT, industrial, and smart devices.

Both JASM and ESMC position themselves very well for the coming years.

 

[Paul2]

TSMC is making some very smart business decisions.

TSMC AZ was announced in 2020 in a $200M+ subsidy partnership with the AZ state government for a $20B fab. The CHIPs Act was announced in 2021 and TSMC now has a signed agreement with the DoC for an additional $8B in subsidies for two AZ fabs ($40B).

The TSMC (22/28nm) fab in Japan cost around $8.5B with about $4B in subsidies from Japan and Sony.

The TSMC (22/28nm) fab in Dresden Germany is projected to cost $11B with $5B in government subsidies. This fab is a joint venture between TSMC, Bosch, Infineon, and NXP, with TSMC holding a majority stake of about 70%.

TSMC does not receive direct government subsidies specifically for building fabs within Taiwan. Instead, TSMC benefits from indirect government support through policies, infrastructure investments, and incentives that foster a robust semiconductor ecosystem in Taiwan. Taiwan also offers favorable tax policies and incentives including tax deductions for R&D expenses and tax breaks for equipment and facility upgrades.

I have no idea how much TSMC has gotten from the Taiwan government over the years but it is substantial. I would bet it will be even more now that TSMC has other bidders for fabs.

17 billions in subsidies worldwide is not a pocket change for sure, the question is if they can turn that into market share. The problem is they are already a dominant gorilla on the top of the market, and most of new competition will be coming at them from below for the first time — something that would've been impossible with old market behaviour, where legacy chip production is not growing.