Taiwan Semiconductor Acts Early To Dodge US Export Curbs, Drops Chinese Tools From Chip Plants

Taiwan Semiconductor Manufacturing Co. TSM is removing Chinese chipmaking tools from its top facilities to shield production from potential U.S. export curbs, underscoring rising geopolitical tensions.

Meanwhile, Washington is easing restrictions and approving fresh Nvidia NVDA chip orders to sustain U.S. tech dominance and keep Chinese firms reliant on American hardware.

Taiwan Semiconductor has begun phasing out Chinese chipmaking equipment from its most advanced plants to safeguard production from potential U.S. export restrictions, sources familiar with the matter told Nikkei Asia.

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The move reflects intensifying geopolitical tensions between Washington and Beijing, prompting semiconductor technology sanctions from the former on the latter, citing national security threats.

The U.S. is offsetting the impact of China’s chip sanctions by greenlighting fresh Nvidia orders.

The company secured 300,000 additional H20 AI chips from Taiwan Semiconductor to meet surging Chinese demand. The move follows eased export restrictions and signals Washington’s effort to maintain U.S. tech dominance while keeping Chinese firms reliant on Nvidia hardware over domestic alternatives like Huawei.

Taiwan Semiconductor prioritized U.S. production and investment over other regions, delaying construction of its second $20 billion plant in Japan’s Kumamoto prefecture to accelerate U.S. expansion amid Washington’s chip tariffs.

The chipmaker has already begun production at its first Japan facility. Still, it is fast-tracking a combined $165 billion U.S. investment plan announced in 2024 and March 2025 to strengthen supply chain resilience and secure long-term growth.

The Taiwanese contract chipmaker stock gained 18% year-to-date, topping the NASDAQ Composite Index’s (which includes Taiwan Semiconductor as a component) over 11% returns.

Price Action: TSM stock is trading higher by 0.45% to $234.05 premarket at last check Monday.

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