Nvidia CEO Jensen Huang delivered his strongest public endorsement yet of TSMC during a Taiwan visit Friday, calling the chipmaker "one of the greatest companies in the history of humanity" just as the US government explores taking equity stakes in semiconductor firms through CHIPS Act funding negotiations.
The timing of Jensen Huang's effusive praise couldn't be more strategic. Standing in Taiwan Friday, the Nvidia CEO didn't just thank TSMC for manufacturing his company's next-generation Rubin AI chips—he positioned the Taiwanese foundry as an unmissable investment opportunity just as Washington weighs unprecedented government stakes in the semiconductor industry.
"Well, first of all, I think TSMC is one of the greatest companies in the history of humanity, and anybody who wants to buy TSMC stock is a very smart person," Huang told reporters, according to CNBC's coverage. The endorsement comes as Commerce Secretary Howard Lutnick confirmed this week that the administration is in talks for a 10% equity stake in Intel and considering similar moves with other chipmakers.
Behind Huang's public diplomacy lies a deepening strategic partnership. TSMC is currently developing six new products for Nvidia, including advanced central processing units and general processing units specifically designed for AI computation. This expanded collaboration underscores how critical the Taiwanese foundry has become to Nvidia's dominance in the AI chip market, where the company commands roughly 80% market share.
The backdrop is the $52 billion CHIPS Act, which has transformed from a manufacturing incentive program into a potential vehicle for government ownership in the semiconductor supply chain. TSMC secured $6.6 billion in promised funding to build three cutting-edge fabrication plants in Arizona, while Samsung and Micron are also receiving substantial support.
Yet conflicting signals from Washington suggest the equity stake strategy remains fluid. While Lutnick told CNBC Tuesday that the government might consider stakes in multiple firms, a Wall Street Journal report Thursday cited a government official saying there were no plans to seek shares in semiconductor companies increasing their US investments. TSMC announced in March it would expand its US investment to $165 billion.
Huang's Taiwan visit also highlighted Nvidia's expanding physical presence on the island. The company is planning "NVIDIA Constellation," a new Taiwan office to house its growing workforce there. "We have many, many employees here in Taiwan, and we're growing here in Taiwan because our supply chain is so busy here," Huang explained, still working with local government to resolve construction issues.
The endorsement carries weight beyond diplomatic courtesy. TSMC shares have gained 6.5% this year, outpacing broader semiconductor indices as investors bet on sustained AI chip demand. The world's largest contract chip manufacturer has become indispensable to the AI revolution, manufacturing not just for Nvidia but also Apple, AMD, and other tech giants requiring cutting-edge process nodes.
Investors are parsing every signal as the semiconductor industry navigates geopolitical tensions between the US and China while managing explosive AI demand. Huang's public backing of TSMC as both a strategic partner and investment opportunity sends a clear message: in the race to control AI infrastructure, the Taiwanese foundry remains irreplaceable.
Huang's Taiwan visit crystallizes the complex dynamics reshaping the global semiconductor landscape. As Washington explores government ownership stakes in critical chipmakers and TSMC deepens its US manufacturing presence, the Taiwanese foundry finds itself at the center of both AI innovation and geopolitical strategy. For investors, Huang's endorsement signals continued confidence in TSMC's position as the indispensable partner in the AI chip supply chain, even as government intervention adds new variables to the investment equation.
