TSMC’s high spending on research, development and new buildings is depleting its financial reserves. In the future, customers will therefore have to pay more for various transactions. At the same time, the length of payment terms the company used would be cut.

Various media outlets in Taiwan are unanimously reporting that a new round of pricing is underway at TSMC that will bring more changes. For example, customers of the foundry will have to fulfill their payment obligations after 15 days instead of 30 days.

TSMC allegedly realized that certain customers were having issues with large inventories in a shrinking market and therefore had to sell their first products at significantly lower prices. The company doesn’t want to be stuck with finished chips. In terms of price increases, an average of ten percent is currently reported, although TSMC will never confirm these figures and will never name them.

TSMC is doing well right now, but the spending is also unique. For example, the company plans to invest up to $44 billion this year alone, outpacing much larger companies. Added to this are even higher prices for raw materials and almost everything on the world market. As a result, the company’s free cash flow has recently dropped 23 percent to its lowest level since last summer.

The company is not only allocating money for future production, but is also building several new factories and is already preparing the next one. In addition to existing locations in Japan and the USA, it is predominantly inland where construction continues. The next megaproject (see image below) is a factory with phases 1 and 2 already planned in Kaohsiung in the south of the country.


Image courtesy of Businesswire

Source: Computer Base

Source: Hardware Info

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