Gown Building Sky Bridge
Arizona, once defined by the five C’s — Cotton, Citrus, Copper, Cattle and Climate — is now bolstered by another “C”: chips. And you cannot make microchips without semiconductors.
Our state has become the hub for the burgeoning semiconductor industry, ranking No. 1 in the U.S. for semiconductor activity in 2025 by Business Facilities magazine and among the top three states in the nation for manufacturing growth in 2024 by Lightcast, a global labor market data and analytics company.
None of this happened by accident. Instead, the rise of Arizona’s semiconductor industry dates back to the 1940s when Motorola established a semiconductor division in Greater Phoenix. Since then — and thanks to thoughtful planning and the vision of business, public policy and economic development leaders — the semiconductor industry has funneled billions of dollars in capital investment into our state’s economy.
Such activity set the stage for the next phase of semiconductor development with the arrival of TSMC Arizona.
In 2020, realizing the rising demand for semiconductor chips, as well as an opportunity to serve our valued American customers, TSMC announced its foray into the United States with a leading-edge fab in north Phoenix.
Founded in Hsinchu, Taiwan, in 1987, TSMC pioneered the pure-play foundry business model. Today, the company is the world’s leading semiconductor foundry, powering nearly 12,000 products — from smartphones and electric vehicles to AI systems and aerospace technologies.
Initially, TSMC invested $12 billion in its 1,100-acre north Phoenix site, but that has grown to $165 billion, representing the largest foreign direct investment in U.S. history.
Our first Arizona fab successfully entered high-volume production in the fourth quarter of 2024, employing N4 process technology, with a yield comparable to our fabs in Taiwan.
Southeast view
Looking Forward
The construction phase of our second fab is complete, and in April we broke ground on our third fab, with plans for more advanced process technology planned for each. TSMC Arizona is well positioned to address the strong AI-related demand of our customers and ensure AI leadership in the US.
The impact has been significant for our state’s economy. An analysis by GPEC in April 2024 showed that $33B in direct economic output would be created from the investment in our first three fabs alone. Another area of positive impact is Arizona’s workforce. Consider the tens of thousands of unique construction jobs created from the Phoenix investment, and also our direct workforce today of more than 3,000 employees. By the end of the decade, we plan to grow our workforce to 6,000 to support three fabs by reaching across U.S. universities and also investing in advanced manufacturing training programs with community colleges and in-state universities. Collectively, these efforts are creating new pathways into the industry and TSMC Arizona.
Industrial Reclamation Water Plant rendering
Something else that is noteworthy about TSMC Arizona is our commitment to sustainability. TSMC was the first semiconductor company to join RE100, a global corporate renewable energy initiative committing our operations to 100% renewable electricity. Water conservation is also an issue the company takes seriously. In north Phoenix, we recently broke ground on an industrial reclaimed water plant designed for “near zero liquid discharge.” This will enable us to recycle at a rate of 90% and reuse almost every drop of water.
Looking back at the last four years, TSMC Arizona’s story is one of innovation and commitment. We are producing the world’s most advanced semiconductors, supporting the biggest names in technology and building the next-generation workforce, all while being the best possible neighbor to our community.
In Arizona, our story is still being written, and the best is yet to come.
At a Glance
Company name: TSMC Arizona
Headquarters: Hsinchu, Taiwan
Number of Employees: 3,000, with plans to grow to 6,000 by the end of the decade
Years in Arizona: Five
Did you benefit from the CHIPS Act? TSMC Arizona will receive $6.6 billion in direct funding under the CHIPS and Science Act.
What vertical(s) do you specialize in? At its first two fabs in north Phoenix, TSMC Arizona manufactures chips using advanced process technologies – including NF to 3-nanometer. Construction on the third fab, which will use N2 and A16 process technologies, has begun, and the company will consider accelerating the production schedule based on the strong demand for AI-related products.
How do you fit into the semiconductor ecosystem? TSMC Arizona is meeting the growing demand for semiconductors by U.S. technology companies by manufacturing chips and using advanced technologies to power everything from smartphones and electric vehicles to AI systems and aerospace technologies.
Photos courtesy of TSMC Arizona
