December 30, 2025 /SemiMedia/ — Taiwan Semiconductor Manufacturing Company (TSMC) has reported a significant surge in demand for its 2nm wafer production, largely driven by artificial intelligence (AI) applications. The company’s 2nm process capacity is now fully booked through the end of 2026, exacerbating the ongoing supply shortage. Industry sources revealed that TSMC has notified its advanced process customers of planned price hikes for the next four years, from 2026 to 2029. While the first quarter of 2026 is typically a slow period for the industry, analysts believe that this price increase will help TSMC maintain its growth momentum. Customers are advised to prepare financially for the price adjustments, which will take effect starting January 1, 2026.

Advanced Node Pricing to Rise as Supply Tightens

The price increase for TSMC’s 2nm wafers will be kept in single-digit percentage ranges, depending on the size of the customer’s order and the terms of the contract. Meanwhile, the 3nm process, facing supply shortages, is expected to see a 3% price increase in 2026. Despite the pressure of multiple price hikes over the next four years, many customers prefer to continue working with TSMC, even though they could opt to shift orders to Samsung’s 2nm GAA (Gate-All-Around) process. Reports indicate that the price increase for TSMC’s 2nm process has been accepted by customers, but final pricing will depend on the terms of individual agreements.

Research firms predict that TSMC’s advanced process price increases will range from 3% to 10%. The 3nm process, originally expected to reach full capacity by 2026, has faced earlier-than-anticipated supply constraints due to the AI-driven demand, forcing TSMC to adjust pricing. Despite challenges such as labor shortages and rising capital expenditures driven by AI demand, TSMC continues to expand its production capacity, leveraging its technological leadership and reliable output.

Apple Locks in Early 2nm Capacity as TSMC Expands Fabs

Apple, TSMC’s largest customer, is expected to account for 24% of the company’s total revenue in 2024. Apple has already secured more than half of TSMC’s initial 2nm capacity for the production of its A20 and A20 Pro chips. With demand exceeding supply, competitors like Qualcomm and MediaTek may have to settle for remaining capacity or shift to TSMC’s more advanced 2nm “N2P” process. To meet the soaring demand, TSMC has begun construction on three new 2nm fabs, though it will take time to ramp up production.