Taiwanese Chips Have Skyrocketed

Taiwan's semiconductor industry is expected to grow by more than 19 percent this year due to strong performance in integrated circuit (IC) manufacturing and design, the Industrial Technology Research Institute, a research institute based in Taiwan, said last week.

The government-backed agency expects the output value of the local semiconductor industry to reach NT$6.33 trillion (US$209.8 billion) this year, up 19.1% from the same period last year, the government-backed agency said in its latest IEK current quarter model report.

The estimate was more optimistic than ITRI's February forecast, when it was expected to grow by 16.2% to NT$6.17 trillion.

By sector, the output value of local IC manufacturing is expected to increase by 23.1% from the same period last year to NT$4.2 trillion, exceeding the previous forecast of 19.4% growth, ITRI said.

TSMC said that the output value of IC design is expected to grow by 13.9% this year to NT$1.44 trillion, up from the previous estimate of 11.3%.

Among them, the output value of IC packaging is estimated to be NT$461.5 billion, an increase of 9% from the same period last year. The output value of IC testing is estimated to be NT$212.2 billion, up 6% year-on-year.

Taiwan Semiconductor Manufacturing Corporation (TSMC), the world's largest chip foundry manufacturer, forecasts that its sales will grow by 24% to 26% in dollar terms this year due to strong demand for high-end processes for AI applications.

Analysts said this is expected to boost the growth of Taiwan's integrated circuit manufacturing and integrated circuit design businesses.

In the first quarter of this year, the output value of Taiwan's semiconductor industry was NT$1.48 trillion, down 0.4% from the previous quarter, but up 27.6% from the same period last year.

According to ITRI, in order to avoid US President Donald Trump's chaotic tariff policy, many customers in Taiwan's integrated circuit industry have placed large orders in advance in the first quarter, thereby increasing the output of this traditional off-season.

Looking ahead to the second quarter, the output value of Taiwan's integrated circuit industry is estimated to reach NT$1.53 trillion, up 20.6% year-on-year and 2.9% year-on-year.

"Taiwan will continue to prosper"

Eric Smith of TechInsights, a specialist platform, said that while U.S. tariffs are the biggest issue facing the industry, most companies at Computex Taipei "will avoid talking directly about tariffs because the situation is too uncertain."

Last month, Washington announced a national security investigation into semiconductor technology imports, which could make the industry a target of President Donald Trump's trade attacks and potentially devastating tariffs.

Since taking office in January, Mr. Trump has threatened to impose steep tariffs on many of America's largest trading partners, with the aim of forcing companies to move production to the United States.

Export-dependent Taiwan has pledged to increase investment in the U.S. to avoid U.S. tariffs of 32% on its exports. But there are concerns that Taiwan could lose its dominant position in the chip sector - the so-called "silicon shield" that protects Taiwan.

Taiwanese chip foundry giant TSMC has announced plans to inject another $100 billion into the United States on top of the $65 billion it has already pledged.

TSMC supplier Universal Wafer also announced last week plans to increase its investment in the U.S. by $4 billion and open a wafer fab in Texas.

But on Friday, when asked about the impact of the tariffs on Taiwan, Huang expressed optimism, saying that Taiwan "will remain at the center of the tech ecosystem."

"There are so many smart companies here, so many innovative and dynamic companies," Huang said. "

"I have every confidence that Taiwan will continue to prosper and develop...... Before, after, and always. "