Shares of Taiwan Semiconductor Manufacturing Company slipped in premarket trading on Thursday after CEO C.C. Wei warned that demand for artificial intelligence chips is expected to outstrip supply for years, highlighting the enormous pressure facing the global semiconductor industry.

Speaking at the company's annual shareholder meeting in Taiwan, Wei said that even with aggressive expansion plans underway, TSMC will struggle to fully satisfy demand from major technology customers building AI infrastructure around the world.

AI Boom Continues to Outpace Manufacturing Capacity

The rapid adoption of artificial intelligence has created an unprecedented surge in demand for advanced semiconductors.

Technology giants, cloud providers, and AI developers are investing hundreds of billions of dollars into data centers and computing infrastructure. As the world's dominant producer of cutting-edge chips, TSMC sits at the center of this investment wave.

According to Wei, manufacturing capacity remains one of the industry's biggest bottlenecks. Even after new U.S. facilities become operational, the company expects demand from American customers alone to exceed available production capacity.

"We will need a long time before we can fully meet customer demand," Wei reportedly told shareholders.

Massive U.S. Expansion Underway

TSMC is significantly expanding its manufacturing footprint in the United States as part of broader efforts to diversify production and support growing customer demand.

The company has already announced plans for six manufacturing facilities in Arizona and is expected to build at least four additional plants under the U.S.-Taiwan trade framework.

These projects represent approximately $165 billion in announced investments, with another $100 billion in potential future spending.

The company has also acquired two additional land parcels in Arizona, which Wei said should provide enough space to support expansion needs for the next decade.

In addition to chip fabrication plants, TSMC plans to open an advanced chip packaging facility by 2029, further strengthening its U.S. operations.

Critical Supplier to the AI Industry

TSMC plays a crucial role in the global AI ecosystem.

The company manufactures many of the world's most advanced AI processors, including chips designed by:

• NVIDIA for its Blackwell GPU platform
• Advanced Micro Devices for its MI450 and Helios AI processors
• Broadcom and other firms developing custom AI accelerators

Because these chips are essential for training and deploying large-scale AI models, any production constraints at TSMC ripple throughout the technology industry.

Stable Pricing Strategy

Despite overwhelming demand, Wei indicated that TSMC does not intend to dramatically raise prices.

The company aims to maintain long-term customer relationships and business stability rather than aggressively monetizing the current supply shortage.

This approach may reassure customers that rely heavily on TSMC's manufacturing capabilities while continuing to support long-term industry growth.

Strong Growth Outlook

The sustained AI boom has already boosted TSMC's financial outlook.

Earlier this year, the company raised its full-year revenue forecast and indicated that capital expenditures are likely to reach the upper end of its projected $56 billion spending range.

The latest comments reinforce a key theme dominating the semiconductor industry: demand for AI computing power continues to grow faster than the world's ability to manufacture the advanced chips needed to support it.

For investors, TSMC's outlook suggests that the AI infrastructure buildout remains in its early stages, with strong demand expected to persist for years as companies race to expand their artificial intelligence capabilities.