Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, has approved a substantial capital budget of $31.28 billion aimed at expanding its production capacity amid a booming demand for semiconductors driven by advancements in artificial intelligence (AI) and 5G technologies. The decision was announced following a board meeting, emphasizing TSMC's commitment to long-term growth and investment in advanced technology capacity and fabrication facilities. The company also projected that its capital expenditure for 2026 may reach the upper limit of $56 billion, reflecting its strategic focus on meeting the increasing demand for high-performance computing applications.

In addition to its expansion plans, TSMC's board approved an increase in its quarterly cash dividend payout to NT$7 (approximately $0.22) per share for the first quarter, up from NT$6 in the previous quarter. This increase follows a record earnings per share of NT$22.08 (around $0.70). Market analysts suggest that the higher dividend is intended to enhance dividend yield and attract investors amidst a favorable outlook for technology stocks, particularly those linked to AI. Since early April, TSMC shares have surged more than 28%, closing at NT$2,255.00 (around $71.54) on Tuesday. The ex-dividend date is scheduled for September 16, with payouts expected on October 8.