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TSMC is the godfather of the AI chip business. NVDA, AMD, MU, Intel, Apple, SK Hynix, etc. all rely on TSMC for fabrication. Yet the only company TSMC has invested it's own capital in is SONY. On Sony's earnings yesterday, their CEO dropped the news that they are entering into a new JV with TSMC to build "next-generation" CMOS image sensor chips, to enable physical AI such as self-driving cars and humanoid robots. This is the second JV that TSMC has with Sony to build this type of chip for Physical AI. Sony CEO said both Sony and TSMC believe in the future demand of physical AI, and both companies want to capture this demand through this new fab JV. If you don't know what Sony's AI chip does, you can find good explanations on YouTube just search 'sony physical AI chip'.
We all know that TSMC has WAY MORE demand for its fabs than it has capacity for. NVDA, AMD, MU, Intel, Apple etc. are dangling hundreds of billions to get TSMC production. Therefore, TSMC would never allocate its manufacturing, engineering, management resources, and let alone billions of its own capital to build a new AI chip plant with Sony if TSMC didn't see significant demand for this type of AI chip. We're all outsiders, but TSMC is the ultimate insider in AI chips, they see and know EVERYONE in the industry, yet they've chosen SONY as the partner to invest in (plus this is the second CMOS image sensor JV that TSMC is doing with Sony, the first one was just completed in 2024). So TSMC is actually doubling down on the Sony AI chip. TSMC putting up their own capital in SONY fab is the ultimate insider signal that there's something very interesting going on here.