The expense associated with producing the latest processors is escalating rapidly, and a recent report indicates that the situation could worsen for consumers. According to China Times, TSMC’s pricing for its next-generation N2 process may exceed 50% of what it currently charges for the N3 node. This increase could lead to significant jumps in CPU and GPU costs for companies such as Apple, Nvidia, and AMD, resulting in a semiconductor price surge in 2025. TSMC previously raised prices by approximately 20% when transitioning from N5 to N3. If the N2 price hike is indeed 50%, chipmakers could find themselves paying nearly 80% more for wafers compared to just two generations prior.
As the world’s leading foundry with minimal competition at the forefront, TSMC has the ability to impose high prices. The production of advanced chips necessitates exceptionally costly equipment, including ASML’s photolithography machines, which can each cost hundreds of millions of dollars. Additionally, TSMC allocates billions annually for research, development, and the establishment of new facilities to develop its latest advanced process node. The pressing question now is whether Apple, Nvidia, and AMD will transfer these increased costs to consumers. Should they choose to do so, a processor priced at $300 today might approach $400 in the near future. Alternatively, companies might opt to design smaller chips to maximize wafer usage, thereby minimizing costs without implementing a complete price increase.
The mass production of N2 chips is anticipated in 2026, with AMD expected to introduce the first consumer products. Observing the price changes for Ryzen processors, Radeon GPUs, or Nvidia graphics cards will provide the clearest insight into the actual impact of this TSMC manufacturing update.
