Taiwan Semiconductor Manufacturing Co TSM stock is trading lower Wednesday amid reports of the leading contract chipmaker operations succumbing to the Taiwan earthquake Wednesday.
Taiwan was hit by a powerful 7.2 magnitude earthquake on Wednesday, the most significant seismic event in the last 25 years.
In response, TSMC promptly evacuated its factories, threatening production capabilities at the globe’s foremost advanced chip maker.
The earthquake struck at 8 a.m. local time, with its epicenter in Hualien, a mountainous and lightly populated county in eastern Taiwan.
The Taiwan fire department reported one death, likely caused by falling debris, and more than 50 people were injured. Damage to several buildings was reported, with some individuals trapped inside.
Following this significant seismic event, TSMC and its main rival, United Microelectronics Corp UMC, evacuated their factory areas, sparking concerns about the potential impact on production at the leading edge of the global advanced semiconductor industry.
A separate report indicated Taiwan’s chip supply chain will likely return to normal operations within a day.
Despite the disruption of semiconductor supply chains in Taiwan due to a 7.4 magnitude earthquake, Taiwan’s Hsinchu Science Park Administration reports no significant impact, with operations remaining stable.
Meanwhile, the key Nvidia Corp NVDA supplier is considering constructing factories for 2-nanometer chips in Hsinchu and Kaohsiung in Taiwan. It is also weighing building a second facility in Kumamoto, Japan, with a potential investment of $13.5 billion.
TSMC gained over 51% in stock value in the last 12 months. Investors can gain exposure to TSMC via VanEck Semiconductor ETF SMH and Vanguard FTSE Emerging Markets ETF VWO.
Price Action: TSM shares traded lower by 1.10% at $138.68 premarket on the last check Wednesday.
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