The weakness might be setting up something interesting here.
There's an unusual combination playing out: supply is increasing and prices are rising at the same time. That tends to only happen when demand is running well ahead of available capacity.
Reports indicate TSMC plans to raise foundry prices by up to 10% starting in 2027. The 2nm process, currently around $30,000 per wafer, could move above $33,000.
Meanwhile, TSMC is still pushing aggressive capacity expansion. Baoshan 2nm capacity has reached around 20,000 wafers per month, new Kaohsiung capacity is coming online, the first-year 2nm output target is 45% higher than 3nm's first year, and 2nm capacity is expected to grow at around 70% CAGR from 2026 to 2028.
The broader picture is that AI demand is pushing the semiconductor industry into a new capacity race. The market may be worried about valuation and short-term cycles, but TSMC remains one of the key suppliers powering the AI ecosystem.
Watching this dip closely. Is $Taiwan Semiconductor Manufacturing(TSM)$ being discounted too aggressively, or is the market pricing in future risks?
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