Key Takeaways
• AMD confirms readiness to begin chip production at TSMC’s Arizona plant
• The decision comes amid potential U.S. semiconductor tariffs under the Trump administration
• AMD will also expand U.S. manufacturing of AI servers and advanced chips
• CEO Lisa Su affirms long-term strategic ties with TSMC and focus on technological leadership
U.S.-based semiconductor giant Advanced Micro Devices (AMD) has confirmed it is prepared to begin chip production at TSMC’s Arizona plant, signaling a major shift in its manufacturing strategy in response to growing trade uncertainties under the Trump administration.
Strategic Move to Arizona Amid Trade Policy Shifts
Speaking to reporters at National Taiwan University in Taipei, AMD CEO Lisa Su announced the company’s readiness to localize production in the U.S. via its longstanding partner, Taiwan Semiconductor Manufacturing Company (TSMC).
This development comes on the heels of President Donald Trump’s renewed tariff threats on imported semiconductor goods. Though electronics were initially exempt from the 10% blanket tariffs introduced April 5, Trump reversed course during a briefing on April 13.
Strengthening U.S. Semiconductor Manufacturing
AMD’s announcement marks a deliberate push to reinforce domestic semiconductor capabilities—especially critical components used in AI servers and high-performance computing (HPC) systems.
• AMD will manufacture more AI servers in the U.S. as part of its expansion
• The Arizona plant is TSMC’s first major fab outside Asia
• Localization aims to reduce AMD’s exposure to trade and supply chain risks
AMD’s move follows similar steps by Nvidia, which recently announced plans to manufacture up to $500 billion worth of AI chips and supercomputers at the same Arizona facility over the next four years.
AMD-TSMC Partnership Enters a New Phase
AMD has long relied on TSMC’s fabs in Taiwan for chip production. The new Arizona facility offers both geographic and strategic diversification, especially as AMD prepares its next wave of HPC products.
• AMD’s EPYC “Venice” is the first high-performance chip built using TSMC’s 2nm process
• The Arizona facility will support advanced chip nodes for future AMD product lines
• Collaboration underscores AMD’s reliance on TSMC’s cutting-edge fabrication capabilities
Industry Tension Mounts Over Tariff Risks
Trade tensions remain high as the Trump administration continues its probe into semiconductor and pharmaceutical imports. While semiconductor goods were initially spared, the administration now suggests targeted levies could be introduced soon.
• The U.S. is re-evaluating exemptions on imported electronics
• Sector-specific tariffs on semiconductors may be announced this week
• Companies like AMD and Nvidia are localizing production to preempt penalties
The unpredictability has added pressure on chipmakers to accelerate U.S.-based manufacturing operations, reshaping supply chain strategy across the industry.
Analyst Sentiment Remains Divided
Despite proactive moves, AMD’s market performance has faltered. According to TipRanks:
• 22 analysts rate AMD a “Buy”; 13 rate it “Hold”
• The average price target is $144.77
• Stock has declined 41% over the past year
Investors remain cautiously optimistic as AMD navigates tariff risks and supply chain shifts, balancing innovation with geopolitical realities.
AMD’s strategic decision to begin chip production at TSMC’s Arizona plant reflects a broader industry shift toward localized manufacturing.
With U.S. trade policies in flux and national security concerns amplifying the call for tech sovereignty, AMD is proactively positioning itself for a new era in global semiconductor leadership.
As AI, HPC, and advanced chip demand continue to surge, AMD’s U.S. expansion could set a precedent for future domestic tech investments.
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