TSMC Weighs Move Into 3D DRAM Memory Chips at Nvidia's Request

The plans focus on 3D DRAM, a design that stacks memory cells vertically to fit more capacity into the same area. They are being led by Hsu Kuo-chin, a TSMC vice president who oversees advanced packaging, The Information said. Options under discussion include building new factories or buying an existing plant and converting it, according to reports that relayed the story. Neither TSMC nor Nvidia commented immediately, and no production timeline, capacity target or investment figure has been made public.

If TSMC goes ahead, the move would change the structure of the chip supply chain behind AI. TSMC makes the processors that Nvidia and most other AI chip designers sell. The high-bandwidth memory packed alongside those processors comes from three companies: Samsung, SK Hynix and Micron. A TSMC entry into DRAM would make it a direct competitor of all three, and would give Nvidia another possible supplier for a component that has become one of the tightest constraints on AI hardware output.

The Shortage Behind the Request

Memory has been in short supply for more than a year as AI data centres take a growing share of world output, and prices have risen sharply as a result. Micron has said it expects the shortage to last into 2028. The effects have spread beyond servers: Apple raised Mac and iPad prices in June, citing memory costs. Elon Musk is also planning his own chip plant, put at $55 billion, partly to rely less on Micron.

Nvidia had already been pulling TSMC deeper into memory. In October it reportedly asked Samsung, SK Hynix and Micron to build the base layer of its custom HBM stacks on TSMC's 3nm process. That arrangement keeps the three memory makers in charge of the DRAM itself while giving TSMC the logic die at the bottom of the stack. Making 3D DRAM would go much further, putting TSMC in charge of the memory cells as well.

TSMC already works closely with all three HBM suppliers on packaging, and SK Hynix has previously signed a memorandum of understanding with TSMC on next-generation HBM. A move into memory would turn some of those partners into rivals.

What Is Still Unknown

Making DRAM involves different processes, equipment and cost economics from the leading-edge logic manufacturing that has made TSMC the industry's dominant foundry, and 3D DRAM is not yet in mass production anywhere. The reports describe internal planning rather than a decision. TSMC's chief executive, C.C. Wei, has not addressed the idea publicly, and the company has given no sign of how much capital it would commit. Investors will look for clues at TSMC's next earnings call in January, and at Nvidia's third-quarter results on November 17.