TSMC

“Especially when you look at the chip design itself, it was much more a, let's start in the digital, let's freeze the digital in, let's send it through some physics for a one time check, like the PDK dictates, I have to have The following feature, otherwise TSN…”

“But they're no longer TSMC's biggest client.”

“If we snap our fingers and double all those things, you might fix a TSMC bottleneck that they're, you're just gonna run into another bottleneck. You make 20% more chips, then you have another bottleneck immediately.”

“If you look at TSMC five nanometer versus four versus three versus two, the performance per watt on these chips doesn't change like a dramatic amount.”

“And my contrarian take is that it wouldn't be that bad. Supply would take a shock for sure, but The best processes that we have in the West, like Intel, not that far behind, at worst, like maybe two X worst performance per watt. And the gap is just far smaller…”

“TSMC, Decreased their rate of growth in twenty-twenty-three and twenty-twenty-four and twenty-twenty-five. So, like, we're, our shortage of compute is going to get worse in the next few years.”

“The scarcity is what ultimately saved Intel. And I expect at some point in the year that they're going to announce like some major partner for the first time. It's going to be a big deal, but it was ultimately TSMC brought it on themselves.”

“The way to solve the geopolitical problem of Dependence on TSMC is to come up with a compute use case that is so massive that everyone is economically incentivized to bring other people up to speed. And then we get the sort of geopolitical insurance for free.”

“With software companies, You know, aside from, like, building on AWS or whatever, you pretty much own your whole stack, and so you're really fully in control of your destiny in that way. With hardware companies, you don't. Like, there's an entire supply chain,…”

“The first is that I think that Silicon Valley investors have become total bitches with respect to revenue concentration. It's like, what the, what are you talking about? Like TSMC has revenue concentration. There's businesses that are like many hundreds of bil…”

“Over the next year or two, you're going to see NVIDIA able to add tons of revenue because they were able to lock up all the supply components.”

“And so for us, we actually operate our own fabs. So in some respect, we're like the TSMC of the optical industry.”

“You have the NVIDIA relationship with TSMC, which famously, they don't even have a written contract. They've dealt with each other for 30 years.”

“They're spending a lot more money, and pledged to invest an additional hundred billion in the U.S.”

“Five to one, and now it's more like seven to one in terms of wafers, you know, to TSMC to Intel.”

“This was the Intel fab 52, which is their most advanced fab. It's a two nanometer fab, and it is on the level of what TSMC does in terms of two nanometer, but of course, at a fraction of the scale of what TSMC does.”

“TSMC customer service is way, way better than I have seen at any other company in any other industry. It's the kind of thing where if you say, hey, you can approve your yield by making this change, you can go make them a recommendation, and then we'll go run a…”

“It is why they're the number one and why they're going to win.”

“And the following day, I get an email from TSMC saying, Gavin, I want to work with Etched. Find a way to make it happen.”

“This was the Intel fab 52, which is their most advanced fab. It's a two nanometer fab, and it is on the level of what TSMC does in terms of two nanometer, but of course, at a fraction of the scale of what TSMC does.”

“And the Foundry side, we are very distant from TSMC. And then in terms of their performance, so that's we have to be humble looking at building the building block, like I mentioned earlier, the IP, the yield, the defect density, and the cycle time to make it m…”

“We are advantaged by the fact that there are constraints on COOS at TSMC. We don't use COOS.”

“I think the chip industry Requires you to go through TSMC, and TSMC requires you to go through ASML or Samsung. I think there are reasonable choke points to manage those challenges.”

“I would allow TSMC and Samsung both to a 20 year period free from all local and legal, local ordinances, all of them, to build fabs in their desired location in the US.”

“The reality is like if a company like Nvidia or AMD were to ever really, really use one of these other foundries, that foundry would get better really quickly.”

“Even TSMC, which is one of our largest holdings they're taking price too, because they just, like, we have a finite amount of capacity, and so we have to try to figure out how are we gonna make sure that we're generating enough profits, and knowing that if we'…”

“Sincerely, they may spend a hundred billion dollars on capex in twenty-twenty-eight, and people, like, just can't fathom that”

“No one's going to blink on their investments for twenty-twenty-six. You actually know the next four quarters of NVIDIA announcement. You know the next four quarters of every one of the infrastructure, which is every single thing we can make. If you can count t…”

“NVIDIA is in the driver's seat because Jensen goes there five, six times a year and he has best friends at TSMC and speaks at their employee day. So they're going to get higher. They are getting a higher allocation to wafers and all that stuff.”

“TerraFab, I'm not that optimistic. I mean, it's so hard to do with that. Because TSMC is so short that, you know, Elon needs to find, but even then, like, how are they going to buy, like, semi-cap equipment from ESML and AMAT? Like, there, there's just no capa…”

“TSMC is planning ahead, working on a fab complex in Arizona, which Tyler visited. Should be able to handle 30% of total advanced truck production at scale, but it's on a knife's edge.”

“What happens if we get super powerful AI and China doesn't? What are they going to do? The optimal thing would be to just bomb TSMC out of existence, because suddenly that becomes optimal, even with all the costs that that does, and then what?”

“I think it is a safer equilibrium To have China dependent on Taiwan than to try to cut them off from Taiwan while we are dependent on Taiwan. Taiwan is 70 miles off the coast of China. It's not an ideal position in the world for us to have a dependency on it a…”

“What I think is most likely is that there is some sort of political coup or action. That destabilizes Taiwan in some way but doesn't actually, doesn't necessarily lead to an invasion, a full-scale invasion, and so sort of this is the best of the both worlds fo…”

“Even if the KMT wins, it's not like TSMC starts disobeying American export restrictions because The way American export restrictions are upheld is that Taiwan utilizes American banking systems, American equipment industries, and so they'll still have to uphold…”

“The supply chain we're gonna have crunches on, on all of the supply chain, really. So if you look at the, sort of, the big components of what any company, but like us, for example, build-out there is dependency on Logic Dies from typically TSMC, maybe Samsung,…”

“ChatGPT comes out. Every hyperscaler starts investing like crazy. What does TSMC do? They actually decreased their capex year over year, two years in a row. They did, they, there was no market response from TSMC to the ChatGPT moment.”

“I think we're looking at a massive short, shortness in chips in 20, 29 or so.”

“Well, actually they were using shell companies to get chips from TSMC and using Different methods of like sneaking HBM, which is memory from, you know, Korea through Taiwan to China, right?”

“TSMC is literally making chips for NVIDIA and Apple and AMD and others in Arizona today, right?”

“The baton got passed from semiconductor shortages in 23 to power and data centers in 24, 25. 26, we're still, we're swinging the pendulum, but it will fully beat semiconductors again in 27, right?”

“I'm bullish on robots, like super bullish on robots, but only for like, not for tasks that have like, TSMC's Arizona fabs, or okay, let's say TSMC Tynon, which I think produces like, you know, indirectly hundreds of billions of dollars of global GDP, even dire…”

“There was also no there were no mentions of AI keywords. Like, if Skynet's really waking up, are they not thinking about Dario Amade? Yeah, so no mentions of Stratechery, no mentions of Dwarkesh, no mentions of TSMC, Abilene, Amadei, TPU.”

“So no mentions of Stratechery, no mentions of Dwarkesh, no mentions of TSMC, Abilene, Amade, TPU.”

“They just did their earnings call, and the comment was, you know, basically, demand for compute is effectively infinite right now, and they're raising their capex. Remember, these are not kind of, these are folks who say, I'm going to spend fifty billion dolla…”

“So instead of building sixty billion, you build a hundred and sixty billion. And we agreed.”

“We were sitting down with Morris Chang, and he was talking about TSMC, and he told us that one of the ways that they aired was trying to exit the integrated circuit market, or diversify from that market, and go into solar. Memories, and there was one other thi…”

“TSMC is absolutely going to be a partner forward, you know, met with them recently and, you know, we want to work closely with them to make sure we get what we need, get fast turnaround times to prototype and all of that.”

“Even right now, five to 10 most valuable companies in the world are hardware companies. Apple, Nvidia, Broadcom, Tesla, TSMC.”

“And I think a lot of things actually, like TSMC, like ASML, those are hard problems that eventually will get easy with robotics, et cetera, but robotics are lagging behind. So I think there's these hard problems that will exist even in two years, and if you're…”

“TSMC can't build fabs fast enough. I think the truth is, is that these are both for TSMC and Samsung. These fabs are the most amazing manufacturing plants on the planet. And, you know, these are 30,000,000,050 billion dollar factories. And the, their ability t…”

“Even if you, as much as you wanted chips last year, it would have been impossible to get them because TSMC was, you know, booked out and so forth.”

“Once you fall behind in chips, it's very, very difficult to catch up because the cycle gets on top of you. TSMC now has the best fabs in the world. The leading edge companies, Apple, Nvidia, AMD, they all build a TSMC. TSMC gets better at what they're building…”

“TSMC is a twenty-four-seven operation where if a line goes down or a customer's got a problem, not only are the technicians need to be ready to go, the engineers need to be ready to go, and that is something that, ah, I think we've lost the muscle memory insid…”

“I know a lot of people's PMs are like, oh, you can't invest in TSMC because geopolitical risk, and it's like, no, dude, you can't invest in fucking Apple.”

“ASML, the Dutch company, they did what's called a customer co-investment program. Where Intel, TSMC, and Samsung pitched in 6.8 billion dollars across R&D funding and equity purchases in the company in order to help pull in order to help ASML. This is 2012.”

“They were able to acquire three million chips, 2.9 million chips from TSMC through these other entities, right? Roughly five hundred million dollars worth of orders”

“Yeah, well, like, I mean, like, every other, like, Huawei's beat Apple, right? They passed Apple up in TSMC orders, they passed Apple up in phone market share not in the US, but, like, in many parts of the world. Before the bans came down, and then even now th…”

“When I was in the White House the first time under President Trump this was part of the efforts that, that he was saying he wanted to focus on, and at his direction, actually, I reached out to TSMC and was in touch with them then to Push them to try and start…”

“The number of people who directly interface with the products of TSMC, ASML, SpaceX, NVIDIA, like how many people do a tape out of TSMC? How many people run an ASML EUV machine is minuscule number of people. And so there are these giant companies where their c…”