In 2015, when NVIDIA and AMD chose TSMC as their primary foundry partner, the decision was met with skepticism. Intel dominated the market, and AMD still controlled its own fabrication network. Yet today, TSMC’s 28nm and advanced nodes power the AI boom, while Intel’s internal struggles have left it playing catch-up. The shift wasn’t just about chips—it was about trust, exclusivity, and a foundry’s willingness to prioritize long-term relationships over short-term profits.
The stakes were never clearer than in a recent conversation where Jensen Huang, NVIDIA’s CEO, confirmed what industry insiders had long suspected: TSMC isn’t just a supplier—it’s a strategic partner. The company now holds exclusive access to TSMC’s most advanced processes, including the A16 node, a first for any customer. This isn’t just a technical edge; it’s a business moat. While competitors scramble for capacity, NVIDIA’s long-term contracts ensure supply stability, even as demand for AI accelerators surges.
AMD’s pivot to TSMC, announced under CEO Lisa Su, was equally transformative. The company had built its own fabrication network, which later spun off as GlobalFoundries, but the decision to shift production to TSMC proved pivotal. By 2020, AMD’s server and client market share surged, a direct result of TSMC’s ability to deliver cutting-edge nodes faster than any internal fab could. Intel, meanwhile, has struggled with its in-house foundry, forcing it to rely on TSMC for its most advanced chips—a irony given its historical dominance.
TSMC’s approach to pricing and capacity allocation further cemented its role as the industry’s linchpin. Unlike competitors that impose abrupt price hikes or favor high-profile clients, TSMC prioritizes gradual adjustments and long-term partnerships. This strategy wasn’t born overnight; it’s rooted in the company’s origins, when Morris Chang, its founder, built TSMC by treating customers as allies rather than just revenue streams. That philosophy paid off when NVIDIA and AMD made their bets.
The impact is undeniable. Without TSMC’s infrastructure, NVIDIA’s AI dominance—from data centers to consumer GPUs—wouldn’t exist. AMD’s resurgence in servers and desktops hinged on TSMC’s ability to execute on nodes like 5nm and 3nm, where Intel lagged. Even Intel, now a TSMC customer for its most advanced chips, can’t escape the foundry’s influence.
For all three companies, the lesson is clear: in an industry where supply chains dictate survival, loyalty isn’t just a business tactic—it’s a competitive weapon. And TSMC wields it masterfully.
