{"id":5095,"date":"2022-06-30T23:56:00","date_gmt":"2022-06-30T15:56:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=5095"},"modified":"2026-04-05T10:26:00","modified_gmt":"2026-04-05T02:26:00","slug":"tsmcs-profit-margin","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/","title":{"rendered":"Why is TSMC\u2019s profit margin much greater than competitors?"},"content":{"rendered":"\n<p>Please check my post of &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/03\/16\/risks-and-disadvantages\/\">TSMC risks and disadvantages in Taiwan<\/a>&#8221; as well.<\/p>\n\n\n\n<p>In my book &#8220;<a href=\"https:\/\/www.books.com.tw\/products\/0010889106\" target=\"_blank\" rel=\"noopener\">The Rules of Super Growth Stocks Investing<\/a>&#8220;, of section 2-4, I once listed a statistical table showing the amazing profit margin rate of TSMC (ticker:  TSM), which later aroused many readers&#8217; response. Due to the length of the book, there is not much discussion of the reasons in the book. This article intends to conduct some in-depth discussions on this topic. <\/p>\n\n\n\n<p>When reading this article, readers can refer to the discussion on section 2-4 of my book &#8220;The Rules of Super Growth Stocks Investing&#8221;, because some of the contents of the book will not be repeated here.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#TSMC_discussion_in_my_books\" >TSMC discussion in my books<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Infinite_support_of_Taiwan\" >Infinite support of Taiwan<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Government\" >Government<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Regulations\" >Regulations<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Human_resources\" >Human resources<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Taiwanese\" >Taiwanese<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Tax_and_subsidy\" >Tax and subsidy<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Taiwan_government_once_held_nearly_half_of_the_shares\" >Taiwan government once held nearly half of the shares<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Geo_drivers_TSMC_profit_margin\" >Geo drivers TSMC profit margin<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Unltra-low_energy_rate\" >Unltra-low energy rate<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Labor_cost\" >Labor cost<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Other_visible_hard_resource_costs\" >Other visible hard resource costs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#How_much_can_TSMC_save\" >How much can TSMC save?<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Wall_Streets_estimation\" >Wall Street&#8217;s estimation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Nikkans_estimation\" >Nikkan&#8217;s estimation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Industry_experts_estimation\" >Industry experts&#8217; estimation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Competitors_estimation\" >Competitor&#8217;s estimation<\/a><\/li><\/ul><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Nationality\" >Nationality<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Chinese_are_hard-working_cheap_and_obedient\" >Chinese are hard-working, cheap and obedient<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#American_dont_want_to_work_overtime\" >American don&#8217;t want to work overtime<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#There_are_no_unions_in_Taiwan\" >There are no unions in Taiwan<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Company_culture\" >Company culture<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-23\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Technology_without_competitors\" >Technology without competitors<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-24\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Monopoly_advanced_process\" >Monopoly advanced process<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-25\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Incredible_yield_rate\" >Incredible yield rate<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-26\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Losses_at_US_plants_widen\" >Losses at U.S. plants widen<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-27\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"TSMC_discussion_in_my_books\"><\/span>TSMC discussion in my books<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>I have discussed the company Nvidia (ticker:NVDA) in two recent books; including:<\/p>\n\n\n\n<p>In my book &#8220;<a href=\"https:\/\/www.books.com.tw\/products\/0010889106?sloc=main\" target=\"_blank\" rel=\"noreferrer noopener\">The Rules of Super Growth Stocks Investing<\/a>&#8220;:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Sections 2-4, the entire section is dedicated to introducing the company TSMC<\/li>\n\n\n\n<li>Section 3-3, analyze the business development of technology companies to grasp the pulse of key industries<\/li>\n<\/ul>\n\n\n\n<p>In my book &#8220;<a href=\"https:\/\/www.books.com.tw\/products\/0010935641?sloc=main\" target=\"_blank\" rel=\"noreferrer noopener\">The Rules of 10 Baggers<\/a>&#8220;:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Section 3-2, the entire section is dedicated to introducing TSMC and the global semiconductor supply chain.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Infinite_support_of_Taiwan\"><\/span><strong>Infinite support of Taiwan<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>TSMC has almost obtained unconditional support from all aspects of Taiwan and the whole country; all difficulties and obstacles will automatically give way to TSMC. This is an indisputable fact. There are many reasons, but the main reason is that for more than two decades, Taiwan has not been able to produce industries that are more globally competitive than foundry and are absolutely conducive to GDP. I personally think this is the main reason. Among the more important ones are:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Government\"><\/span>Government<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Regardless of whether the central or local government encounters TSMC, it is as if they have been given a sword, and any obstacles will automatically give way. This gives TSMC an advantage that no one can match.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Regulations\"><\/span>Regulations<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Almost all of Taiwan\u2019s current industrial policies are tilted towards the electronics industry where TSMC is located. Even if the regulations do not allow it, it will expand the interpretation or modify the law to meet TSMC\u2019s needs.<\/p>\n\n\n\n<p>The South Korean media JoongAng Ilbo reported on June 19, 2022 that the bureaucracy of the South Korean government has slowed down the construction of semiconductor factories. A professor Park Jea-Gun at Hanyang University pointed out that it only takes two to two and a half years for companies to build a chip factory in the United States and Taiwan, but it takes six to seven years in South Korea.<\/p>\n\n\n\n<p>In February 2024, the Korean media &#8220;Donga Ilbo&#8221; pointed out that TSMC&#8217;s Kumamoto Factory 1 announced construction drawings in October 2021 and broke ground in April 2022. The entire process took only two years and four months. Considering that trial production started at the end of last year, the actual construction to completion only took 20 months, which is considered very fast for Japan, which is slow and has strict regulations. &#8220;Dong-A Ilbo&#8221; believes that South Korea Semiconductor built a semiconductor factory in just six months 41 years ago, and now it will take eight years at the fastest in South Korea. <\/p>\n\n\n\n<p>For example, Donga Ilbo stated, SK Hynix\u2019s SK Hynix semiconductor industry cluster in Yongin has not yet started construction since it was selected in February 2019. The project was originally supposed to start in 2022, but construction progress has been repeatedly delayed due to obstacles such as opposition from local residents, land compensation issues and water supply permits. Even if construction starts next year and operations begin in 2027, it will still take eight years. Samsung&#8217;s Pyeongtaek plant also lost five years due to the transmission tower dispute.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Human_resources\"><\/span>Human resources<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>As the salaries of other local companies, most of them are not at the same level as TSMC. The gap is so great that almost all Taiwanese engineering graduates take TSMC as their first consideration for their careers, because they have no better choice. It also makes it easy for TSMC to use the perspective of &#8220;company picking people&#8221; and almost monopolize the selection of most of the talents of science and engineering background who graduate from schools in Taiwan every year.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Taiwanese\"><\/span>Taiwanese<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The masses are short-sighted and blind, and the human nature of relying on the big watermelon. Seeing the great raising of TSMC in recent years, they are all annoyed that TSMC is the only one to follow, as if there are no other companies in Taiwan (I think Taiwan still has other good companies, and the package is not bad). I saw in the newspaper a while ago that a young Taiwanese girl bring a boy who had long planned to get married and worked in the Hsinchu Science Park home to see their parents. <\/p>\n\n\n\n<p>At first, the girl\u2019s parents were warmly entertained, but during the conversation, they discovered that the future son-in-law was not working for TSMC. They immediately showed an unhappy and indifferent expression. On the spot, the girl didn\u2019t know what to do. Afterwards, the girl&#8217;s parents forced the girl to break up with the boy. \u2500\u2500\u2500The reason is to find a man who works at TSMC. A boy who does not work at TSMC has no future. What I want to say is, will it be like this ten years ago?<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Tax_and_subsidy\"><\/span>Tax and subsidy<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The Korea Times quoted data from the Korea Economic Research Institute that South Korea\u2019s corporate tax cap is 25%, while Taiwan\u2019s is only 20% (The Yin Xiyue government pushed for a new bill to reduce the top corporate tax rate from 25% to 22%, still higher than TSMC). TSMC enjoys tax incentives of up to 15% and state subsidies for 40% of packaging costs. <\/p>\n\n\n\n<p>The Korea Times&#8217;s report pointed out that in terms of labor costs, the average annual salary of TSMC employees is 95 million won (about 2.4 million Taiwan dollars), which is lower than Samsung&#8217;s 144 million won (about 3.6 million Taiwan dollars). In addition, there are about 10,000 people in Taiwan receiving advanced chip manufacturing training, while only about 1,400 people in South Korea. The Taiwan government also bears the training and education costs for semiconductor manufacturing professionals.<\/p>\n\n\n\n<p>Since its inception, TSMC has enjoyed various subsidies and tax credits from the Taiwanese government. Due to the long-term disproportion between taxation and its profits, this move has also caused considerable controversy in Taiwan. Moreover, in January, 2023, Taiwan passes its Chips Act, offers 25% tax credits to chipmakers, TSMC is the biggest beneficiary.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Taiwan_government_once_held_nearly_half_of_the_shares\"><\/span>Taiwan government once held nearly half of the shares<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The Taiwan government\u2019s official National Development Fund was also TSMC\u2019s largest shareholder. In the early days, TSMC\u2019s shareholding was as high as 48.3% when TSMC was in need of money, but it has dropped to 6.3% in 2020.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Geo_drivers_TSMC_profit_margin\"><\/span><strong>Geo <\/strong>drivers TSMC profit margin<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><a href=\"https:\/\/semiwiki.com\/forum\/index.php?threads\/the-thinking-of-pat-gelsinger.14476\/\" target=\"_blank\" rel=\"noreferrer noopener\">Intel CEO Pat Gelsinger said: &#8220;building a new fab in Asia is 30% cheaper than in US and 50% cheaper in China than in US.&#8221;<\/a> This also explains why 75%-80% of semiconductor factories are in Asia, less than 20% in the United States, and almost negligible in Europe. Therefore, the United States now regards this issue as a national security issue of the United States, forcing TSMC and Samsung (ticker: SSNLF) to set up factories in the United States, and it also restricts semiconductor factories with advanced manufacturing processes.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Unltra-low_energy_rate\"><\/span>Unltra-low energy rate<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>TSMC&#8217;s electricity consumption accounts for 5% of Taiwan&#8217;s electricity consumption. In 2019, the electricity consumption was 14.327 billion kWh, an annual increase of 17.9%, equivalent to 91% of Taipei City&#8217;s annual electricity consumption, and the average annual growth rate in the past five years. 12.5%. This is mainly because the EUV energy conversion efficiency is only 0.02%, and the annual power consumption of the 3nm factory is 7 billion kWh.  <\/p>\n\n\n\n<p>In 2022, Bloomberg Businessweek reported that the share of electricity consumption in Taiwan rose to 6% in 2020, and is expected to reach 12.5% \u200b\u200bin 2025. Bloomberg stated in February 2024 that if electricity prices rise to the same level as South Korea in 2025, it may cause the operating profits of most chip manufacturers to fall by 8% to 18% from the current consensus level.<\/p>\n\n\n\n<p>ASML&#8217;s (ticker: ASML) most advanced extreme ultraviolet lithography equipment is estimated to consume about 1 million watts of power each (depending on the model), and the power consumption is more than 10 times that of previous generations of equipment. But it is the only choice for the most advanced manufacturing processes. TSMC currently has more than 80 EUV units.<\/p>\n\n\n\n<p>The point is that Taiwan is a world-renowned low-rate energy country. The government&#8217;s energy policy for decades has been to use the government&#8217;s budget to subsidize energy and absorb the increasing cost to ensure that Taiwan&#8217;s energy rates (including oil, electricity, and water) must be lowest among all Asia Pacific countries; this is a big plus for TSMC, which belongs to the ultra-high energy-intensive industry. <\/p>\n\n\n\n<p>According to Taiwan&#8217;s Ministry of Economic Affairs, Taiwan&#8217;s industrial electricity rates are the sixth-lowest in the world, and residential electricity rates are the fourth-lowest in the world.<\/p>\n\n\n\n<p>TSMC&#8217;s water consumption in 2019 is equivalent to the capacity of 79,000 Olympic swimming pools. The average annual rainfall in Taiwan is 2,515 mm, which is three times the average rainfall in the world. Coupled with the long-term low water bills, few Taiwanese want to save water. But for the past ten years, Taiwan has been running out of water. For the past two decades, our water policy has always been to subsidize farmers for fallow crops, and agricultural water has been forced to be used by industry. <\/p>\n\n\n\n<p>I mentioned in the articles &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/09\/28\/israels-venture-capital\/\" target=\"_blank\" rel=\"noreferrer noopener\">Beyond your imagination of Israel\u2019s strong venture capital and tech strength<\/a>&#8221; and &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/10\/04\/israeli-stock-market\/\" target=\"_blank\" rel=\"noreferrer noopener\">Israel stock market and tech giants<\/a>&#8221; that Israel&#8217;s national water-saving recycling rate is over 90%. However, the recycling rate of industrial water in Taiwan has also been too cheap for a long time. It was not until recent years that there was a shortage of water, and investment in recycling and water saving began to be made, but it is currently very, very low.<\/p>\n\n\n\n<p>TSMC has a total of nearly 300 water trucks of its partners on standby to deal with the crisis of water shortage. In 2021, in response to the drought, it was reported that TSMC spent NT$200 million to book more than 100 water trucks. In order to cope with future droughts, TSMC will spend 2.8 billion in 2021 to save water and make zero interruptions in production. Because of the shortage of water to buy water, according to TSMC&#8217;s own estimates, it will affect 0.7-1.1% of its revenue.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Labor_cost\"><\/span>Labor cost<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The local personnel cost in the United States is 50% to more than two times higher than that in Taiwan (see below survey data), and the American has low productivity, poor obedience, many different opinions, high turnover rate, and the best related talents will go to Silicon Valley, will not come to TSMC wafer factory, these are labor costs. <\/p>\n\n\n\n<p>TSMC\u2019s high pressure and long working hours have a turnover rate of only 1\/3 of that of the industry peers in Taiwan. In the past ten years, the turnover rate of employees has been below 5%; but these are all data in Taiwan. In the United States, these data are useless. Engineers have very few choices in Taiwan, but there are more in the United States. TSMC founder Morris Chang said that TSMC&#8217;s 25-year experience in setting up a factory in Oregon, USA can be proved: &#8220;We were too naive at the time. In terms of cost, the cost of manufacturing chips in the United States is 50% more expensive than that in Taiwan.&#8221;<\/p>\n\n\n\n<p>New engineers who graduate from top Taiwanese schools can expect to earn a starting salary of about NT$2 million (about US$67,000), according to Taiwan&#8217;s local human resources agency. But in the US, $67,000 is incredibly low for an American engineer.<\/p>\n\n\n\n<p>The following is the salary data of Glassdoor showing the annual salary of local workers in the United States, in US dollars. The average annual salary of engineers TSMC has hired in the United States is about $118,000. Intel engineers earned an even higher average of more than $128,000. Data will speak:<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"594\" height=\"362\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/06\/g.jpg\" alt=\"Glassdoor US annual salary\" class=\"wp-image-10486\" srcset=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/06\/g.jpg 594w, https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/06\/g-300x183.jpg 300w\" sizes=\"auto, (max-width: 594px) 85vw, 594px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Other_visible_hard_resource_costs\"><\/span>Other visible hard resource costs<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Resource costs include electricity, water, land, plant, etc. Taiwan\u2019s electricity power, and water costs have long been the lowest among Asian rival countries. If it is not in the densely populated states on the east and west coasts such as California or New York, the states in the Midwest, the land acquisition cost is considered low.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_much_can_TSMC_save\"><\/span>How much can TSMC save?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Wall_Streets_estimation\"><\/span>Wall Street&#8217;s estimation<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>General Wall Street semiconductor industry analysts estimate that the manufacturing cost of Intel&#8217;s (ticker: INTC) US plant is more than twice that of TSMC, mainly because the US does not have a semiconductor downstream ecosystem including packaging, testing, PCB module, and assembly industry chain. It also lacks the efficiency required for wafer substituting manufacturing.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Nikkans_estimation\"><\/span>Nikkan&#8217;s estimation<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>The Japanese media Nikkan has estimated that the Arizona factory of TSMC seems to be very difficult, and the &#8220;construction cost&#8221; alone is 6 times higher than that in Taiwan. Intel Chief Executive Pat Gelsinger mentioned that &#8220;compared to the United States, the cost of building a factory in Asia is 30% less, and if you build a factory in China, it will be 50% less. The cost gap between factories will reach hundreds of millions of dollars. Therefore, if American manufacturers want to gain an advantage, they will need as little as 30% to 50% of economic subsidies.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Industry_experts_estimation\"><\/span>Industry experts&#8217; estimation<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p><a href=\"https:\/\/www.semiconductors.org\/wp-content\/uploads\/2021\/05\/BCG-x-SIA-Strengthening-the-Global-Semiconductor-Value-Chain-April-2021_1.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">A report published by Bowden Consulting (BCG)<\/a> and the American Semiconductor Industry Association (SIA) in April 2021 pointed out that the total cost of owning a fab in the United States is 25% to 50% higher than in Asia. <\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Competitors_estimation\"><\/span>Competitor&#8217;s estimation<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Intel\u2019s vice president of global regulatory affairs, Greg Slater, also stated that the cost of manufacturing chips in Europe will also be 30%-40% higher than in Asia. Therefore, market analysts stated that even if governments of various countries promise to provide subsidies to TSMC and other chip manufacturers, they may not be able to fill the gap of up to 40%.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Nationality\"><\/span><strong>Nationality<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Chinese_are_hard-working_cheap_and_obedient\"><\/span>Chinese are hard-working, cheap and obedient<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The Chinese are talented, obedient, smart, and diligent. They are among the best in the world. This is nationality and gift and cannot be quickly cultivated. All these make TSMC have unparalleled corporate production efficiency. Apple\u2019s chief executive, Tim Cook, said the same thing when lamenting that Western countries cannot escape China\u2019s supply chain. Musk also said that &#8220;Chinese workers don&#8217;t just stay up late, they work overtime until 3 a.m. and don&#8217;t even leave the factory, whereas in America, people are always trying to avoid going to work.&#8221;<\/p>\n\n\n\n<p>Everyone, just think about why Taiwan\u2019s ODMs companies have moved their factories to India and Southeast Asia for many years, but they still can\u2019t get rid of mainland China. The reason is not that the governments of various countries put pressure on them to resist China and spend money to build. The factory can do it. Western countries also want to get rid of their dependence on China, but in reality it is impossible to do so. We will find time to talk about this subject when we have the opportunity.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"American_dont_want_to_work_overtime\"><\/span>American don&#8217;t want to work overtime<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>I also mentioned in the book that you need a white American with a high degree of education to work overtime for you for a long time, and you have to be on standby at any time after get off work. If you have an urgent problem, you need to get up in the middle of the night and immediately return to the factory for repair. This is impossible. <\/p>\n\n\n\n<p>But in Taiwan, many highly educated employees take it for granted to sell livers for the company. Not only do they have no overtime pay, they may receive less than half of the salary of white Americans, and they have been doing it for decades. None of these phenomena can happen in the United States.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"There_are_no_unions_in_Taiwan\"><\/span>There are no unions in Taiwan<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>And don&#8217;t forget that the power and ability of American labor unions are not something we Asians can understand and imagine. Many people have been stuck on the notion that unions are organizations of American blue-collar workers. But the times have changed a long time ago. <\/p>\n\n\n\n<p>Just look at how the unions of the Alphabet (ticker:s GOOGL and GOOG) and Microsoft (ticker: MSFT) in recent years are so powerful that they affect the company\u2019s decision-making, and even force the company to give up the tens of billions deal company has acquired. All the way down to Starbucks (SBUX: SBUX), Amazon (AMZN: AMZN), and even Apple (AAPL: AAPL) recently. To a business person, you will shudder at the unions in the United States.<\/p>\n\n\n\n<p>In his early days of mergers and acquisitions, Buffett had experienced many times the intangible and powerful negative influence of labor unions on business operations. The most famous one was in January 1977, when Buffett invested 32 million US dollars to acquire the Buffalo Evening News. Interested investors can refer to the description in Buffett&#8217;s biography.<\/p>\n\n\n\n<p>What about in Taiwan? Except for Formosa Plastics Group because of founder  But what about in Taiwan? Except for Formosa Plastics Group because of founder Wang Yongqing &#8220;specially ratify&#8221;, non-public or non-state-owned large-scale listed companies in Taiwan rarely have strong labor unions. In my impression, only EVA Air in recent years, I mean strong and influential in normal times The union of the company&#8217;s decision-making (not the kind that only speaks out when the company goes out of business). <\/p>\n\n\n\n<p>Many people will say that our company has an employee welfare committee that asks me to deduct money every month. Is that a union? That should be regarded as a cheerleader for the company and the capital!<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Company_culture\"><\/span>Company culture<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>TSMC is known for long hours, strict management, and an emphasis on discipline and hierarchy, according to Nikkei interviews with suppliers, current and former employees, and an analysis of comments on recruitment platforms.<\/p>\n\n\n\n<p>Many TSMC employees have experienced this: at any time (even holidays) they may be called to work with unexpected problems, such as earthquakes, power outages, or any other production interruption. &#8220;You can get an emergency call at any time\u2026if there is a major accident, you have to go back to the factory right away,&#8221; said one employee. &#8220;Most employees and suppliers don&#8217;t think it&#8217;s easy to replicate this working model in the U.S.&#8221;<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"133\" height=\"74\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/07\/p.png\" alt=\"profit margin\" class=\"wp-image-11809\"\/><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Technology_without_competitors\"><\/span><strong>Technology without competitors<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Monopoly_advanced_process\"><\/span><strong>Monopoly advanced process<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Like my previous blog posts &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/13\/yield-rate-comparison\/\" target=\"_blank\" rel=\"noreferrer noopener\">Yield rate comparison of SMIC, Rapidus, TSMC, Samsung, Intel&#8217;s advanced process<\/a>&#8220;, &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/semiconductor-investment\/\" target=\"_blank\" rel=\"noreferrer noopener\">6 common wrong semiconductor investment myths<\/a>&#8221; and &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/12\/comparison-of-tsmc-intel-and-samsungs-new-process-roadmaps-for-future-chips\/\" target=\"_blank\" rel=\"noreferrer noopener\">Comparison of SMIC, Rapidus, TSMC, Intel, and Samsung\u2019s new process roadmaps for future chips<\/a>&#8221; explained, the foundry price of an advanced process is much higher than that of a mature process; that is, the profit is higher, which is very easy to understand. And TSMC almost covers most of the advanced process orders, of course, it makes more money than others.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Incredible_yield_rate\"><\/span><strong>Incredible <\/strong>y<strong>ield rate<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>In addition to monopolizing the advanced process, what is even more rare is that the yield rate of TSMC&#8217;s advanced process is very close to the mature process. Yield equals margin rate! Take a look at Samsung&#8217;s yield in my post &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/13\/yield-rate-comparison\/\" target=\"_blank\" rel=\"noreferrer noopener\">Yield rate comparison of SMIC, Rapidus, TSMC, Samsung, Intel&#8217;s advanced process<\/a>&#8220;, you should understand.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"block-992c5942-9f38-43db-816c-6380a02194a2\"><span class=\"ez-toc-section\" id=\"Losses_at_US_plants_widen\"><\/span>Losses at U.S. plants widen<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p id=\"block-7789dd14-8f35-44db-a8ca-d6324d36496a\">According to TSMC&#8217;s 2024 annual report, the loss of TSMC Arizona Corporation, its Arizona subsidiary, will expand from NT$10.925 billion (US$320 million) in 2023 to NT$14.298 billion (US$447 million) in 2024. In comparison, TSMC&#8217;s Nanjing plant in China will make a profit of NT$26 billion (US$813 million) in 2024. The gap between the two is quite huge.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/03\/23\/tsmc-ceo-appalling-remarks\/\">&#8220;TSMC CEO appalling remarks on Chinese robots, inferiority to nVidia Huang<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/04\/04\/skywater-3d-chip-us-foundry\/\">SkyWater, 3D chip leader and the only pure-play US chip foundry<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/09\/22\/chang-refuted-by-yeh\/\">Morris Chang refuted by Yeh Wanan, Taiwan was unwilling to invest in TSMC<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/05\/05\/semiconductor-to-taiwan\/\">How important is semiconductor industry to Taiwan?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/03\/02\/tsmc-moat-competitiveness\/\">165 billions investment proved TSMC moat and competitiveness is fragile<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/03\/16\/risks-and-disadvantages\/\">TSMC risks and disadvantages in Taiwan<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/02\/06\/tsmc-originally-founded\/\">How was TSMC originally founded? Not by Morris Chang<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/12\/28\/morris-changs-controversial\/\">TSMC Morris Chang&#8217;s controversial words and deeds<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/01\/31\/tsmc-advanced-packaging-evolution-history\/\">TSMC Advanced Packaging Evolution History<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/01\/05\/semiconductor-packaging-2\/\">TSMC is becoming the lord of semiconductor packaging, in addition to foundry<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/10\/21\/abandoned-nuclear-hit-tsmc\/\">Taiwan&#8217;s abandoned nuclear hit TSMC hard, profit margins decrease 1% by electricity price increase<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/09\/06\/what-are-silicon-photonics\/\" target=\"_blank\" rel=\"noreferrer noopener\">What are silicon photonics? Why it&#8217;s important? and current progress<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/10\/02\/rapidus-tsmcs-rival\/\">Rapidus will be TSMC&#8217;s strongest rival in the future<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/09\/28\/how-does-onto-make-money\/\">How does Onto make money? Advanced packaging beneficiary<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/07\/10\/mong-song-liang\/\" target=\"_blank\" rel=\"noreferrer noopener\">Mong-Song Liang, the hero of SMIC\u2019s breakthrough in US blockade<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/01\/09\/tsmc-valuation\/\">Why is TSMC valuation much lower than US peers?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/11\/30\/tsmc-negative-corp-culture\/\" target=\"_blank\" rel=\"noreferrer noopener\">TSMC negative toxic corp culture and management style are detrimental to its future and growth<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/04\/10\/four-chip-companies\/#google_vignette\" target=\"_blank\" rel=\"noreferrer noopener\">Four chip companies account for one-third of S&amp;P 500 gains so far this year<\/a><\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/04\/06\/artificial-intelligence-listed-companies\/\" target=\"_blank\" rel=\"noreferrer noopener\">Top five lucrative artificial lucrative intelligence listed companies<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/04\/01\/tsmc-dcf-value\/\">What&#8217;s TSMC DCF intrinsic value?How to calculate it quickly with a free tool?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/10\/01\/how-many-fab-does-tsmc-have\/\" target=\"_blank\" rel=\"noreferrer noopener\">How many fabs and houses does TSMC have currently and in the future?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/13\/yield-rate-comparison\/\" target=\"_blank\" rel=\"noreferrer noopener\">Yield rate comparison of SMIC, Rapidus, TSMC, Samsung, Intel&#8217;s advanced process<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/04\/29\/cost-of-chip-foundry\/\">The TSMC cost, sell price, and R&amp;D cost of chip foundry<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/01\/15\/asml-who-really-caught-tsmcs-neck\/\" target=\"_blank\" rel=\"noreferrer noopener\">ASML, who dominate TSMC\u2019s fate<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/12\/28\/tsmc-process-roadmap\/\" target=\"_blank\" rel=\"noreferrer noopener\">Comparison of SMIC, Rapidus, TSMC, Intel, and Samsung\u2019s new process roadmaps for future chips<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/07\/30\/two-long-term-threats-to-tsmc\/\" target=\"_blank\" rel=\"noreferrer noopener\">Two long-term threats to TSMC: US and SMIC<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/30\/tsmcs-profit-margin\/\" target=\"_blank\" rel=\"noreferrer noopener\">Why is TSMC\u2019s profit margin much greater than competitors?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/08\/13\/how-does-tsmc-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does TSMC make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/11\/02\/zyvex\/\" target=\"_blank\" rel=\"noreferrer noopener\">Zyvex and sub-nanometer semiconductor processes, will Zyvex threat TSMC?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/01\/28\/tsmc-serious-crises\/\">TSMC gets emerging&nbsp;and serious challenges<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/24\/nvidia-changes-gaming-rules\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does nVidia make money, Nvidia is changing the gaming rules<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/11\/nvidias-monopoly\/\" target=\"_blank\" rel=\"noreferrer noopener\">The reasons for Nvidia\u2019s monopoly and the challenges it faces<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/01\/29\/arm-acquired-by-nvidia\/\">Why nVidia failed to acquire ARM?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/07\/02\/revisiting-nvidia\/\">Revisiting Nvidia: The Absolute Leader in Artificial Intelligence, Data Center, and Graphics<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/10\/30\/how-does-intel-make-money-and-the-benefits-to-invest-in-it\/\">How does Intel make money? and the benefits to invest in it<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/11\/05\/intels-current-difficult-dilemma\/\">Intel&#8217;s current difficult dilemma<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/11\/22\/texas-instruments-bio\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Texas Instruments make money? Amazing long term capital reward and company net profit margin!<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/04\/22\/amd-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How AMD makes money? A rare case of turning defeat into victory<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/02\/05\/amd-jaw-dropping\/\" target=\"_blank\" rel=\"noreferrer noopener\">Why is AMD\u2019s performance so jaw-dropping?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/01\/qualcomm-diversifies\/\" target=\"_blank\" rel=\"noreferrer noopener\">Qualcomm diversifies success, no nonger highly dependend on phone<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/01\/29\/how-arm-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does the ubiquitous Arm make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/07\/23\/significant-changes-in-broadcoms-business-approach\/\" target=\"_blank\" rel=\"noreferrer noopener\">Significant changes in Broadcom\u2019s business approach<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/03\/04\/data-center-a-rapidly-growing-semiconductor-field\/\">Data center, a rapidly growing semiconductor field<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/04\/18\/applied-materials\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Applied Materials, lord of semiconductor equipment, make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/08\/12\/lam-research-chip-equipment\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Lam Research, top chip equipment player, make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/09\/25\/the-lucrative-semiconductor-industry\/\" target=\"_blank\" rel=\"noreferrer noopener\">The lucrative semiconductor supply chain<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/01\/25\/global-semiconductor-chip-market-in-detail\/\" target=\"_blank\" rel=\"noreferrer noopener\">Global semiconductor chip market in detail, big dominators and markets<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/07\/semiconductor-investment\/\" target=\"_blank\" rel=\"noreferrer noopener\">6 common wrong semiconductor investment myths<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/23\/3rd-gen-semiconductor\/\" target=\"_blank\" rel=\"noreferrer noopener\">Gen 3 semiconductor<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/06\/14\/eda-synopsys-cadence-mentor\/\">Three EDA oligopoly vendors: Synopsys, Cadence, and Siemens&#8217;s Mentor Graphics<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/01\/22\/how-cadence-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does, the EDA oligopoly, Cadence make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/22\/how-synopsis-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Synopsis, the EDA oligopoly, make money?<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Why is TSMC\u2019s profit margin much greater than competitors?<\/p>\n","protected":false},"author":1,"featured_media":11809,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[28,1432,490,175,548,176,485,493,178,483,192,110,30,526,23,11],"tags":[2,227,64,167,770,97,95,41,3,183,260,410],"class_list":["post-5095","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-us-stock-market","category-compensation","category-entry-barrier","category-gross-margin","category-monopoly","category-net-margin","category-oligopoly","category-operating-efficiency","category-operating-margin","category-price-power","category-regulation","category-semiconductor","category-south-korea-stock-market","category-supply-chain","category-taiwan-stock-market","category-buffett","tag-aapl","tag-amzn","tag-asml","tag-bcg","tag-eva-air","tag-goog","tag-googl","tag-intc","tag-msft","tag-sbux","tag-tsm","tag-umc"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/5095","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=5095"}],"version-history":[{"count":111,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/5095\/revisions"}],"predecessor-version":[{"id":41560,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/5095\/revisions\/41560"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/11809"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=5095"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=5095"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=5095"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}