Taiwan Semiconductor Manufacturing Company (TSMC) has warned that the global semiconductor industry remains years away from producing enough advanced chips to satisfy the explosive growth of artificial intelligence.

Speaking at the company’s annual shareholder meeting in Hsinchu, Taiwan, Chief Executive Officer C.C. Wei said demand from AI customers continues to exceed available manufacturing capacity despite aggressive expansion efforts.

According to Wei, production bottlenecks remain one of the largest obstacles facing the global AI industry as technology companies race to deploy increasingly powerful computing infrastructure.

“It will be a long time before we can meet customer demand,” Wei told shareholders.

Nvidia, AMD, and Broadcom Drive Competition

TSMC sits at the center of the AI revolution as the world’s leading manufacturer of advanced semiconductors.

The company produces cutting-edge chips for many of the industry’s largest players, including Nvidia, AMD, and Broadcom, all of which are benefiting from unprecedented demand tied to artificial intelligence.

As hyperscalers and cloud providers dramatically increase spending on AI infrastructure, competition for access to TSMC’s most advanced manufacturing processes has intensified.

Industry estimates suggest major technology companies could collectively spend approximately $725 billion on AI-related infrastructure during 2026 alone.

Massive U.S. Expansion Still Not Enough

TSMC has been expanding production capacity globally in an effort to address the growing shortage.

As part of its broader international growth strategy, the company has already committed approximately $165 billion toward six manufacturing facilities in the United States.

Bloomberg previously reported that TSMC is evaluating plans for at least four additional U.S. fabrication plants, potentially requiring another $100 billion in investment.

Despite these massive expenditures, Wei indicated that future capacity additions are unlikely to fully close the gap between supply and demand anytime soon.

The company has also secured sufficient land in Arizona to support expansion plans for at least the next decade.

TSMC Rejects Aggressive Price Increases

While demand continues to outstrip supply, TSMC signaled it does not intend to pursue dramatic price increases similar to those seen in parts of the memory chip industry.

Wei emphasized that maintaining long-term customer relationships and business stability remains a priority.

The company’s approach contrasts with some areas of the semiconductor sector where shortages have resulted in sharp pricing increases during periods of constrained supply.

TSMC’s strategy focuses on sustainable growth while continuing to invest heavily in advanced manufacturing technologies.

AI Boom Continues to Fuel Growth

The AI-driven surge in semiconductor demand continues to deliver strong financial results for TSMC.

Wei reaffirmed the company’s expectation that revenue will grow by more than 30% this year, a forecast that was raised only weeks ago.

The company also indicated that capital expenditures are likely to reach the upper end of its projected range, which could total as much as $56 billion during 2026.

Meanwhile, TSMC employees are expected to benefit from the industry’s boom as the company announced average bonus payouts will increase by more than 30%.

Semiconductor Bottleneck Remains Critical

TSMC’s warning highlights a growing challenge facing the global AI industry.

While companies continue announcing massive investments in data centers, AI models, and cloud infrastructure, access to advanced semiconductor manufacturing remains one of the most significant constraints on future growth.

With demand from AI developers, hyperscalers, and enterprise customers continuing to accelerate, TSMC’s comments suggest that supply shortages could remain a defining feature of the semiconductor market well into the next decade.