TSMC chair shrugs off Samsung challenge: 'Competitors are essentially dreaming'

TSMC Chairman Wei Che-chia said rivals hoping to overtake the world's largest foundry are "essentially dreaming," shrugging off the prospect that Samsung Electronics could displace the Taiwanese chipmaker at the top of the contract semiconductor manufacturing market.

Speaking to reporters after TSMC's annual shareholder meeting in Hsinchu, northern Taiwan, on Thursday, Wei said "Taiwan's advantage will continue to be maintained" when asked whether Samsung Electronics — the world's second-largest foundry — could ever claim the top spot, according to Yahoo Finance.

Wei said that while South Korea leads the world in high-bandwidth memory (HBM) chip output, TSMC still holds a firm grip on the most advanced packaging technology globally.

"Taiwan has capabilities built up over decades," he said. "The entire ecosystem — from TSMC's foundry operations through back-end packaging and testing to system assembly — is already in place. That kind of semiconductor ecosystem is not something Korea can easily replicate in the short term."

The remarks came in response to a question about whether Taiwan's technological edge was under threat as South Korea moves to mirror Taiwan's science park cluster model, with the government assembling materials and equipment companies to build startup and industrial complexes.

Without naming Samsung Electronics directly, Wei said: "Our competitor said 20 years ago that they would catch up with TSMC in 10 years. They said the same thing 10 years ago, and they are saying it again now."

According to market research firm TrendForce, TSMC held a 69.9 percent share of the global foundry market last year, with Samsung Electronics in second place at 7.2 percent. The gap between the two widened from 55 percentage points in 2024 to 62.7 percentage points last year.

At the shareholder meeting, Wei expressed optimism about the industry outlook, saying AI model adoption "continues to grow across consumer, enterprise and national-level AI applications." He said the trend is driving demand for greater computing power, which in turn is generating strong demand for advanced semiconductor chips.

TSMC raised its annual sales outlook in April and said capital expenditure is expected to reach as much as $56 billion — the top of its previously guided range — reflecting the company's confidence in future demand.

On concerns about a potential plateau in AI capital spending, Wei said TSMC is "very confident about growth over the next few years, based on forecasts of customer and end-consumer demand, as clearly reflected in the company's large-scale capital expenditure." He added that "the economic outlook and demand over the next few years will be quite favorable."

Wei also said the average bonus payout for TSMC employees would increase by more than 30 percent this year.