TSMC's 2nm node took 8% of wafer revenue in the third quarter, up from 3%

2nm starts paying

TSMC's third-quarter revenue reached $46.72 billion, up 41.2% from a year earlier and 16.2% from the previous quarter, the company reported. High-performance computing supplied 68% of revenue, against 57% a year earlier.

2nm was not the volume leader. The 3nm process took 33% of wafer revenue, 5nm 28% and 7nm 10%. Every node at 7nm and below accounted for 79% of wafer revenue. The 2nm share, at 8%, is small beside those figures, but it more than doubled in one quarter from 3%. Wafer revenue shares are not comparable to total-company revenue shares, TradingKey noted.

Goldman Sachs analysts said TSMC's capacity would likely keep lagging surging AI demand near term, Tech Times reported.

Arizona is the test case

TSMC raised its Arizona commitment by $100 billion in July. The total now stands at $265 billion across 12 facilities.

The plan adds dedicated CoWoS packaging capacity to the site, the 2.5D technology that AI accelerators need before they ship as working products. Tech Times reported that CoWoS capacity, not wafer production, is the single binding constraint on how many accelerators Nvidia, AMD and the cloud providers can deliver. Arizona's packaging lines target that constraint directly.

TSMC has not confirmed a date for 2nm output in Arizona. Wccftech reported that 2nm production there was expected to begin in the second half of 2026, citing the Taiwanese outlet Ctee, which said the schedule was roughly a year ahead of the original timeline. The same report said plumbing and electrical construction at the site still needed work.

AMD said its EPYC "Venice" processors are ramping on TSMC's 2nm process in Taiwan, with plans to ramp at the Arizona fab later. AMD calls Venice the first high-performance computing product in production on 2nm.

What the ramp costs

Gross margin was 66.4% in the third quarter, down from 67.7% in the second. Management attributed the sequential drop to ramping 2nm. TSMC lifted 2026 capital expenditure guidance to $60 billion to $64 billion in July, from a prior range of $52 billion to $56 billion. Management has warned that building and ramping plants abroad dilutes gross margin. The company has not said what margin it expects from Arizona once 2nm output starts there. TradingKey noted that higher prices for leading-edge wafers may be absorbed by early-stage production costs.

Capacity targets and the next decision

Reports out of Taiwan put 2nm monthly output at 110,000 wafers by mid-2027, up from 90,000, roughly 22% more, sammyfans reported. TSMC declined to comment, the site said, citing Chosun.

Fourth-quarter guidance is $52.3 billion to $54.3 billion in revenue, about 14% higher than the third quarter at the midpoint. Gross margin guidance for the quarter is 65% to 67%, with operating margin at 56.5% to 58.5%. Those figures cover the whole company. Five 2nm fabs are entering ramp this year, and combined output is expected to be 45% higher than 3nm fabs reached at the same stage. TSMC is also weighing a Texas manufacturing hub, but Reuters reported on 30 September that talks were preliminary and no final decision has been made.