TSMC’s four overseas manufacturing subsidiaries posted a combined H1 2026 profit of NT$58.53 billion ($1.84B), up 215% year‑on‑year – a record high. The star performer: TSMC Arizona, whose profit surged 661% to NT$36.07 billion ($1.13B), overtaking the Nanjing fab as the largest overseas profit contributor.

The Arizona fab now accounts for 2.44% of TSMC’s total H1 net profit (NT$1.28T), confirming that post‑volume‑production efficiency is kicking in. However, Q2 profit dipped **13.6%** sequentially to NT$14.60B, as accelerating plant construction brings higher depreciation costs – a pressure point to watch.

JASM (Japan’s Kumamoto fab) swung to a **NT$1.68B profit** in H1, after losing NT$9.77B in full‑year 2025. But the July 7.1‑magnitude earthquake near Kumamoto may hurt Q3 results due to equipment recalibration and wafer scrappage.

The Dresden project (ESMC) remains in the red with a NT$485M loss as construction proceeds, while the **Nanjing fab** earned NT$14.98B and the Shanghai fab NT$5.81B – both stable, with no capacity or node upgrades planned.

On capacity, Arizona’s Fab 1 runs 4nm since Q4 2024, Fab 2 targets 3nm (H2 2027), and Fab 3 (topped out in May) is set for 2nm. TSMC has added four more fabs (P4‑P6) and advanced packaging, raising total US investment to **$265B**. Subsidies from governments totaled only NT$590M in H1, down sharply from NT$67.1B a year ago.

ICgoodFind Takeaway:
TSMC’s overseas fabs are entering profit cycles – Arizona leads the pack. But rising depreciation, earthquake risk, and AI demand volatility call for cautious capacity pacing.