U.S. shares of Taiwan Semiconductor Manufacturing Co. TSM outpaced the broader chip sector Monday following a report that increased AI-related orders from Nvidia Corp. NVDA have allowed the third-party fab to increase use of its capacity significantly. On Monday, Taiwan’s Economic Daily News reported that TSMC was now using 70% to 80% of its 5-nanometer transistor-making capacity because of Nvidia orders, up from previous usage levels in the more than 50% range. In chip parlance, nanometers, or nm, refer to the size of the transistors that are etched onto a silicon wafer to make a computer chip, with the general rule being that smaller transistors are faster and more efficient in using power. TSMC has the capacity to make up to 130,000 5-nm wafers a month, and is currently running a production volume of about 90,000 to 100,000 wafers a month because of the additional Nvidia orders, which will be delivered in July, according to the report. Nvidia is expected to cash in big on the artificial intelligence surge via hardware and software sales this year. American depositary receipts of TSMC rose more than 4.4% near intraday highs in recent trade, while the PHLX Semiconductor Index SOX was up 2.8%
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