Taiwan Semiconductor Manufacturing Co. (NYSE:TSM), the world’s leading contract chipmaker, is enabling its long-term partner, MediaTek, to adopt its most advanced 2-nanometer (nm) process for an upcoming flagship system-on-a-chip (SoC). This collaboration underscores a major technological leap for both companies.

MediaTek confirmed that the new SoC has successfully completed the “tape-out” stage, where the final design is sent for manufacturing.

According to a report by the Taipei Times, the chip is set for mass production in the second half of 2025, with a likely market release by late 2026.

Also Read: Taiwan Semiconductor’s $150B Bet Transforms Arizona Into A Global Chipmaking Hub Amid AI Boom

While the chip’s official name remains unconfirmed, industry analysts speculate it’s the Dimensity 9600, MediaTek’s next-generation mobile SoC.

Why the 2-nm Process Matters

The 2-nm process is a critical milestone in semiconductor manufacturing, allowing for significantly smaller transistors, which in turn leads to higher density, faster performance, and lower power consumption.

For a chip to be profitable for mass production, it typically requires a yield of over 70%, with a yield of 60–70% during research and development indicating strong progress.

Taiwan Semiconductor’s Deputy Co-Chief Operating Officer Kevin Zhang stated that the 2-nm process marks the company’s entry into nanosheet transistor architecture, a new design that improves efficiency and performance.

At a Semicon Taiwan forum, MediaTek president Joe Chen credited the Taiwan Semiconductor partnership for enabling its flagship chips to deliver highly efficient performance across products from edge applications to cloud services.

MediaTek highlighted its long collaboration with Taiwan Semiconductor in mobile platforms, computing, automotive electronics, and data centers.

Broader Industry Impact and Taiwan Semiconductor‘s Growth

The demand for Taiwan Semiconductor’s 2-nm technology is high, with several other tech giants reportedly lining up. Analysts like Ming-Chi Kuo have indicated that Apple (NASDAQ:AAPL) plans to use the 2-nm A20 chip in its iPhone 18 lineup.

Other key customers include Intel (NASDAQ:INTC) and Advanced Micro Devices (NASDAQ:AMD), with Nvidia (NASDAQ:NVDA) also expected to use the technology for future products.

Taiwan Semiconductor’s strong position in the semiconductor market is reflected in its stock performance, which has gained over 33% year-to-date, surpassing the PHLX Semiconductor Index’s 22% return.

The company is further solidifying its ecosystem by planning a new multifunctional service center in Pingtung County, set to open in mid-2027.

Taiwan Semiconductor stated the center will upgrade local partners’ capabilities, enabling them to win projects from global players such as Intel, Micron (NASDAQ:MU), and Infineon (OTC:IFNNY).

Price Action: TSM stock is trading higher by 1.47% to $266.65 premarket at last check Thursday.

Read Next:

• Alibaba And SMIC Power Beijing’s Bid To End Reliance On Nvidia And ASML

Photo by Jack Hong via Shutterstock