TSMC 2022 Business Overview

https://www.tsmc.com

This report is made with recycled paper.

Vision, Mission & Core Values Table of Contents

Vision
1 Letter to Shareholders 3
Our vision is to be the most advanced and largest technology and foundry services
provider to fabless companies and IDMs, and in partnership with them, to forge a
powerful competitive force in the semiconductor industry.
2 Introduction 9

To realize our vision, we must have a trinity of strengths:

1. Be a technology leader, competitive with the leading IDMs 3 Market Overview 12
2. Be the manufacturing leader
3. Be the most reputable, service-oriented and maximum-total-benefits
silicon foundry 4 TSMC’s Trinity of Strengths 15

5 Corporate Governance 18
Mission
Our mission is to be the trusted technology and capacity provider of the global logic IC 6 Environmenal, Social and Governance 19
industry for years to come.

7 Financial Statements 21
Core Values
Integrity
Integrity is our most basic and most important core value. We tell the truth. We believe
the record of our accomplishments is the best proof of our merit. Hence, we do not brag.
We do not make commitments lightly. Once we make a commitment, we devote ourselves
completely to meeting that commitment. We compete to our fullest within the law, but
we do not slander our competitors and we respect the intellectual property rights of
others. With vendors, we maintain an objective, consistent, and impartial attitude. We do
not tolerate any form of corrupt behavior or politicking. When selecting new employees,
we place emphasis on the candidates’ qualifications and character, not connections or
access.

Commitment
TSMC is committed to the welfare of customers, suppliers, employees, shareholders, and
society. These stakeholders all contribute to TSMC’s success, and TSMC is dedicated to
serving their best interests. In return, TSMC hopes all these stakeholders will make a
mutual commitment to the Company.

Innovation
Innovation is the wellspring of TSMC’s growth, and is a part of all aspects of our business,
from strategic planning, marketing and management, to technology and manufacturing.
At TSMC, innovation means more than new ideas, it means putting ideas into practice.

Customer Trust
At TSMC, customers come first. Their success is our success, and we value their ability to
compete as we value our own. We strive to build deep and enduring relationships with
our customers, who trust and rely on us to be part of their success over the long term.
1 Letter to Shareholders
Dear Shareholders,
The year 2022 was a landmark year for TSMC. Supported by our strong technology leadership and
differentiation, we delivered a thirteenth-consecutive year of record revenue, with strong profitable
growth. Our 2022 annual revenue increased 33.5% year-over-year in U.S. dollar terms, while our EPS
rose to NT$39.20, nearly tripling over the past three years.

These achievements were earned in the face of considerable economic, human and geopolitical
challenges across the world. The year started with continued COVID-19 lockdowns, conflict in Ukraine,
and geopolitical tensions and trade restrictions that severely disrupted global supply chains. Retreat of
globalization and free trade fueled inflationary pressure around the world, increased macroeconomic
uncertainty, and impacted consumer confidence. In the second half of the year, pandemic-related
demand, such as remote working and remote learning, receded as many parts of the world began to
re-open, and the semiconductor industry entered an inventory correction mode.

The world also began to focus more intently on the importance of the semiconductor industry, as it
suddenly recognized the critical role semiconductors play in a modern economy. The rising tensions in
geopolitics also accentuated the attention on a resilient semiconductor supply chain, and the key role it
plays in their economic and national infrastructure security.

For TSMC, we continued to focus on the fundamentals of our business. We enriched our R&D intensity
and worked diligently on our technology development, especially 2-nanometer, to deliver full node
strides in performance and power benefits to our customers, while offering the industry’s most
advanced transistor scaling. We also increased our productivity and fab operations quality, while
successfully bringing our industry-leading 3-nanometer to high volume manufacturing in 4Q’22.
We deepened our service and expanded our capacity to support our customers’ growth, further
earning their trust, as evidenced by higher scores in our annual customer survey. We enhanced
our cybersecurity systems and measures continuously, to rigorously protect customers’ IP and our
proprietary information. As we entered our third year of digital transformation, we accelerated the
pace to keep our employees connected and productive in a flexible work environment, while protecting
them from COVID infection with stringent anti-pandemic measures.

Despite the recent macroeconomic uncertainties around the world, the fundamental structural growth
trajectory in the long-term semiconductor demand remains strong, underpinned by the industry’s
multi-year megatrends of 5G and High Performance Computing (HPC)-related applications. Therefore,
we continuously work closely with our customers in a disciplined manner to plan our capacity, based
on the long-term market demand profile, and investing in leading edge and specialty technologies, to
support their structural growth.

As geopolitical tensions have arisen in different parts of the world, our customers also start to value
more geographic manufacturing flexibility, in addition to technology leadership, manufacturing
excellence, low cost and trust of service quality.

Under this environment, based on customers’ request, we are expanding our global manufacturing
footprint, to increase customer trust, to expand our future growth opportunities, and to reach for
global talents.

03
 In Taiwan, our N3 has just entered volume production in Tainan Science Park. We are also preparing for Gross profit margin was 59.6 percent as compared with 51.6 percent in 2021, while operating profit
N2 volume production starting in 2025, which will be located in Hsinchu and Taichung Science Parks. margin was 49.5 percent compared with 40.9 percent a year earlier. Net profit margin was 44.9
percent, an increase of 7.3 percentage points from 2021’s 37.6 percent.
In the U.S., we are in the process of building two advanced semiconductor fabs in Arizona, with N4
and N3 process technology, respectively. We are also building a 12-inch specialty technology fab in In 2022, the Company further raised its total cash dividend payments to NT$11.0 per share, up from
Kumamoto, Japan. NT$10.25 a year ago.

These investment decisions are based on our customers’ needs in each region, and a necessary level of Technological Developments
government support. We believe this is a necessary step to maximize value for our shareholders.
In 2022, we continued to increase our investment in R&D to US$5.47 billion to extend our technology
leadership and differentiation. We also work closely with our customers to enable the global pool of
Our pricing will remain strategic to reflect our value, which also includes the value of geographic
innovators, to unleash their innovations and create greater value for the semiconductor industry.
manufacturing flexibility. At the same time, we will continue to leverage our competitive advantages of
large volume, economies of scale and manufacturing technology leadership, to continuously drive costs
In its third year of ramp, our 5-nanometer family of technologies contributed 26% of TSMC’s revenue.
lower. We will also continue to work closely with all the regional governments, to secure their support.
We continued to enhance our N5 family’s performance, power and density, and N4 started volume
production in 2022. We also introduced N4P and N4X technologies, targeting next wave 5nm
Combining such actions, TSMC will have the ability to absorb the higher costs of overseas fabs, while
products. N4P technology development is well on track, and volume production is scheduled in 2023.
remaining the most efficient and cost-effective manufacturer, no matter where we operate. Thus,
N4X is TSMC’s first HPC-focused, workload-intensive technology, with customers’ product tape-outs in
even as we increase our capacity outside of Taiwan, we can continue to earn a sustainable and healthy
2023.
return, while delivering long-term profitable growth for our shareholders.

After N3 technology entered volume production in 2022, N3E will further extend our N3 family, with
To address the insatiable demand for energy-efficient computing power, customers rely on TSMC not
enhanced performance, power, and yield. Volume production of N3E is scheduled for 2H’23. We are
only for reliable capacity, but also a predictable cadence of technology development.
working on a high level of customer engagement at both N3 and N3E, with the number of tape-outs
more than 2x that of N5 in its first and second year. We expect our N3 family to be another large and
We continued to extend our technology leadership, as our 3-nanometer technology entered volume
long-lasting node for TSMC.
production in 2022, and is the most advanced semiconductor technology in both PPA and transistor
technology.
Our 2-nanometer technology will adopt nanosheet transistor structure, and deliver full-node
performance and power efficiency gains, with 10-15% speed improvement at the same power or
We are building a strong foundation for the next generation technology to follow. N2 technology
25-30% power improvement at the same speed as compared to N3E, to address the increasing need
development is on track, with risk production scheduled in 2024 and volume production in 2025. Our
for energy-efficient computing. N2 will provide our customers with the best performance, cost and
2-nanometer technology will be the most advanced semiconductor technology in the industry in both
technology maturity, and extend our technology leadership position well into the future.
density and energy efficiency when it is introduced.

As TSMC pushes the envelope of transistor scaling, we also continue to expand our TSMC 3DFabricTM
Highlights of TSMC’s accomplishments in 2022:
● Total wafer shipments were 15.3 million 12-inch equivalent wafers as compared to 14.2 million
design solutions, as another dimension to improve system-level performance. TSMC 3DFabricTM
consists of both wafer-level 3D and advanced packaging technologies. For our 3D technologies,
12-inch equivalent wafers in 2021.
● Advanced technologies (7-nanometer and beyond) accounted for 53 percent of total wafer revenue,
TSMC-SoIC® Chip-on-Wafer (CoW) technology successfully entered volume production in 2022,
demonstrating significant performance improvement by stacking SRAM chips on logic wafers.
up from 50 percent in 2021.
● We deployed 288 distinct process technologies, and manufactured 12,698 products for 532
TSMC-SoIC® Wafer-on-Wafer (WoW) technology demonstrated superb system performance
enhancement for HPC products in 2022 by stacking 7nm logic wafer on deep trench capacitor
customers.
● TSMC produced 30 percent of the world semiconductor excluding memory output value in 2022, as
wafer. For our advanced packaging technologies, the CoWoS®-S technology that integrates multiple
system-on-chip (SoC) chips, high bandwidth memory stacks, and a 3-reticle size silicon interposer
compared to 26 percent in the previous year.
successfully entered volume production for customer HPC products in 2022. For InFO advanced
packaging technology, TSMC successfully entered volume production of Integrated Fan-Out on
2022 Financial Performance
Substrate (InFO_oS) that integrates multiple SoC chips in a 2-reticle size fan-out package.
Consolidated revenue reached NT$2,263.89 billion, an increase of 42.6 percent over NT$1,587.42 billion
in 2021. Net income was NT$1,016.53 billion and diluted earnings per share were NT$39.20. Both To help customers unleash their product innovations with fast time-to-market, TSMC provides
increased 70.4 percent from the 2021 level of NT$596.54 billion net income and NT$23.01 diluted EPS. customers with comprehensive infrastructure needed to optimize design productivity and cycle times.
TSMC continues to expand our Open Innovation Platform® (OIP), providing over 55,000 items of
TSMC generated net income of US$34.07 billion on consolidated revenue of US$75.88 billion, which libraries and silicon IP portfolio, more than 43,000 technology files, and over 2,900 process design kits,
increased 59.6 percent and 33.5 percent respectively from the 2021 level of US$21.35 billion net from 0.5-micron to 3-nanometer in 2022.
income and US$56.82 billion consolidated revenue.

04 05
 Environmental, Social and Governance In February 2022, TSMC, Sony Semiconductor Solutions Corporation (SSS) and Denso Corporation
jointly announced a joint venture of Japan Advanced Semiconductor Manufacturing (JASM). In addition
As a responsible global corporate citizen, TSMC is focused on driving changes in Green Manufacturing, to the previously announced 22/28 nanometer process, TSMC will also enhance JASM’s capabilities
establishing a Responsible Supply Chain, Talent Development, Inclusive Workplace, and Caring for the with 12/16 nanometer FinFET process technology, and increase monthly production capacity to 55,000
Underprivileged. In 2022, we published our first UN SDGs (United Nations Sustainable Development 12-inch wafers. With the additional capacity, the total capital expenditure for JASM’s Kumamoto fab is
Goals) Action Report and Materiality Analysis Report to enhance the transparency of our sustainability estimated to be approximately US$8.6 billion with strong support from the Japanese government.
progress.
Honors and Awards
Green Manufacturing is the cornerstone of our sustainability management. TSMC strives to be a global
standard of an eco-friendly corporation, and we integrate green management into all aspects of our daily TSMC received recognition for achievements in innovation, corporate governance, sustainability,
operations, both in Taiwan and overseas. In 2022, TSMC’s Reclaimed Water Plant commenced operations investor relations and overall excellence in management from organizations including Forbes,
in the Southern Taiwan Science Park and began water supply of 10,000 metric tons of water per day, Fortune Magazine, Asiamoney, The Asset,
CommonWealth Magazine, Taiwan Capacity Plan
with the goal of reaching 36,000 metric tons per day by 2026. At TSMC Arizona, we plan to build an
Industrial Water Reclamation Plant, which would allow us to reach “Near Zero Liquid Discharge.” Stock Exchange, and Taiwan Institute for
7%
Sustainable Energy. For innovation, TSMC was 2021
13-14
In our supply chain, TSMC is actively working with our suppliers to drive low-carbon emissions recognized as 3rd in IFI Claims Patent Services’
9%
management, a key component of our roadmap to Net Zero Emissions by 2050. We continue to “2022 Top 50 US Patent Assignees.” TSMC 2022
15-16
expand carbon capture opportunities in our supply chain management, and encourage our suppliers to was also recognized by Fortune Magazine as
set up carbon capture facilities to reduce carbon emissions. “2022 World’s Most Admired Companies.” 2023
5%
16-17
In sustainability, we were chosen once
Talent is critical to the global semiconductor industry’s success. We believe TSMC’s global footprint again as a component of the Dow Jones
Annual Growth Rate
expansion not only enables us to better support our customers, but also gives us more opportunities Sustainability Indices, becoming the only Capacity: million 12-inch equivalent wafers
to reach global talent. To attract more talent and create a sustainable recruitment pipeline for the semiconductor company to be selected for
semiconductor industry, TSMC continues to invest in semiconductor related research through close 22 consecutive years. We also received MSCI
Wafer Sales Plan
collaboration with top universities including National Taiwan University, National Tsing Hua University, ESG Research’s AAA Rating, CDP’s “2022 CDP
National Yang Ming Chiao Tung University, National Cheng Kung University, MIT, Stanford University, UC Supplier Engagement Leader,” Sustainalytics’ 2021 50% 50%
Berkeley, Arizona State University, Tokyo University, and other prestigious institutions around the world. “Company ESG Risk Ratings-Low ESG
Risk” rating, ISS ESG’s “Prime” status in
In order to deepen employee awareness and practice of Diversity and Inclusion, TSMC focuses on the ESG Corporate Rating, and Corporate 2022 47% 53%

enhancing employees’ awareness of respecting individual differences and its unique values in the Knight’s “2022 Global 100 Most Sustainable
workplace. TSMC has designed a course on unconscious bias to help employees identify and respond Corporations.” Meanwhile, we remained a
2023 40-50% 50-60%
to biases in the right way. Employees can also use intercultural assessment tools to evaluate themselves major component in various MSCI ESG and
and learn how to work with colleagues from diverse backgrounds in their teams. FTSE4Good indices. In investor relations,
> 7nm ≤ 7nm
TSMC continued to receive multiple awards 2023 wafer shipment is expected to be 14-15 million 12-inch

The TSMC Education and Culture Foundation and the TSMC Charity Foundation have long been from Institutional Investor Magazine. equivalent wafers.

invested in driving positive changes towards a better society, by focusing on caring for the
disadvantaged and helping youth education. In 2022, the TSMC Charity Foundation assisted 6,358 Outlook
students at 134 rural care institutes and collaborated with TSMC volunteers to produce tutorial videos
Entering 2023, macroeconomic and geopolitical uncertainties persist. As global COVID-19 pandemic
for scientific experiments and science education. TSMC also partnered with SEMI to hold a session at
subsides, we have entered a more intelligent and connected world. As semiconductors become
2022 SEMICON Taiwan, promoting a matching platform that offered 600 jobs opportunities from 30
increasingly essential and ubiquitous to every part of our daily lives, semiconductor technology is
different companies to rural vocational students.
becoming a foundational technology for the modern digital economy. The semiconductor value in the
global supply chain continues to increase, creating greater value opportunities for our customers, and
Corporate Developments
greater value opportunities for TSMC.
In December 2022, TSMC announced that, in addition to TSMC Arizona’s first fab, which is scheduled
to begin production of N4 process technology in 2024, the Company has also started the construction It is more important than ever for TSMC to fulfill our mission to be the trusted technology and capacity
of a second fab in Arizona to begin production of 3nm process technology in 2026. The overall provider for the global logic IC industry for years to come. We will uphold our Trinity of Strengths of
investment for these two facilities will be approximately US$40 billion. When completed, TSMC Technology Leadership, Manufacturing Excellence, and Customer Trust, to address and capture the
Arizona’s two fabs will manufacture over 600,000 wafers per year. strong growth opportunities.

06 07
 We are increasing our investments in R&D, to continue to extend our overall competitiveness and
technology leadership. With our leadership in both leading edge process technologies and 3DIC
solutions, TSMC’s technology cadence remains constant, to deliver the value of our technology
2 Introduction
platform, and to help our customers to enhance their product competitiveness and to grow their
markets well into the future. Company Profile

Established in 1987 and headquartered in Hsinchu Science Park, Taiwan, TSMC pioneered the pure-play
We continue to focus on optimizing our manufacturing operations to drive greater efficiency and foundry business model with an exclusive focus on manufacturing its customers’ products. By choosing
productivity, including “digitalization” of our fabs, to support high volume ramp of N3 in 2023 and not to design, manufacture or market any semiconductor products under its own name, the Company
beyond. ensures that it never competes with its customers. Based on this founding principle, the key to TSMC’s
success has always been to enable its customers’ success. TSMC’s foundry business model has led
We are increasing our capacity beyond Taiwan to expand our future growth potential, to reach to the rise of the global fabless industry, and, since its inception, TSMC has been one of the world’s
for global talent, and to further increase our customer trust. As we expand our global footprint, leading semiconductor foundries. In 2022, the Company manufactured 12,698 different products
and recruit people from around the world, our priority is to identify, attract and hire talent whose using 288 distinct technologies for 532 different customers.
core values and principles are aligned with TSMC’s, so that we can establish TSMC culture in all our
employees, no matter where we operate. TSMC-made semiconductors serve a global customer base that is large and diverse entailing a wide
range of applications. These products are used in a variety of end markets including high performance
We recognize the increasingly important role of TSMC in the global semiconductor industry, our impact computing, smartphones, the Internet of Things (IoT), automotive, and digital consumer electronics.
to many of the world’s economies, and the responsibilities that come with our position. We remain Such strong diversification helps to smooth fluctuations in demand, which in turn allows TSMC to
steadfast to our dedicated maintain high levels of capacity utilization and profitability, and generate healthy returns for future
foundry business model, and investment.
will continue to work as One
Team to support all the IC The annual capacity of the manufacturing facilities managed by TSMC and its subsidiaries exceeded 15
innovators and enable their million 12-inch equivalent wafers in 2022. These facilities include four 12-inch wafer GIGAFAB® fabs,
success. We will hold ourselves four 8-inch wafer fabs, and one 6-inch wafer fab – all in Taiwan – as well as one 12-inch wafer fab at a
to rigorous standards of wholly owned subsidiary, TSMC Nanjing Company Limited, and two 8-inch wafer fabs at wholly owned
corporate governance, and subsidiaries, WaferTech in the United States and TSMC China Company Limited.
adhere to our core values
of Integrity, Commitment, In December 2022, TSMC announced that, in addition to TSMC Arizona’s first fab, which is scheduled
Innovation and Customer to begin production of N4 process technology in 2024, the Company has also started the construction
Trust, while pursuing a of a second fab in Arizona to begin production of 3nm process technology in 2026. The overall
sustainable future. We are investment for these two facilities will be approximately US$40 billion. When completed, TSMC
honored to earn your trust in Arizona’s two fabs will manufacture over 600,000 wafers per year, with estimated end-product value
TSMC through the challenges of more than US$40 billion. At the same time, the Company continues to execute its plan for a fab in
of 2022. We are more excited Kumamoto, Japan, with production targeted for 2024.
about our future, and are even
more firmly committed to TSMC provides customer support, account management and engineering services through offices in
earning good returns for our North America, Europe, Japan, China, and South Korea. At the end of 2022, the Company and its
shareholders in the years to subsidiaries employed more than 73,000 people worldwide.
come.
The Company is listed on the Taiwan Stock Exchange (TWSE) under ticker number 2330, and its
American Depositary Shares (ADSs) are traded on the New York Stock Exchange (NYSE) under the
symbol TSM.

Mark Liu C.C. Wei

Chairman Chief Executive Officer

08 09
 R&D Highlights in 2022

To meet our customer’s needs in today’s dynamic marketplace, TSMC is accelerating the pace of its Revenue Net Income
Revenue and Net Income
innovation by offering leading-edge processes as well as a wide variety of specialty technologies to  Unit: NT$ Billion  Unit:
Unit: NT$
NT$ Billion
Billion

unleash their innovation. Many of our technological breakthroughs in materials, processing, and 1,031 1,070 1,339 1,587 2,264 351
597 345
763 518
843 597
948 1,017
977
188 264 307 334 343
advanced lithography are enabling devices to be faster, smaller and more power efficient. In 2022, the
Company developed or introduced a wide variety of technologies.

A summary of highlights is below:

Advanced Technology Highlights

● 2nm (N2) technology development is on track and making good progress. N2 technology features
TSMC’s first generation of nanosheet transistor technology with full-node strides in performance and
power consumption. Volume production is expected in 2025.
● 3nm fin field-effect transistor (FinFET) (N3) technology started volume production in the second half
2018 2019 2020 2021 2022 2018
2013 2019
2014 2020
2015 2021
2016 2022
2017
of 2022 as planned. N3E technology, an enhanced version of N3 technology, will continue to provide Net Revenue Net Income (Shareholders of the Parent)

industry-leading advantages for both mobile communication and high-performance computing (HPC)
applications. Volume production is expected in the second half of 2023.
● 4nm FinFET (N4) technology, an enhanced version of 5nm FinFET (N5) technology, started volume
Market Capitalization – Year End Assets and Equity – Year End
production in 2022. 4nm FinFET Plus (N4P) technology development is on track and making good  Unit: NT$ Billion  Unit: NT$ Billion
progress. Customer product tape-outs were received in 2022 and volume production is expected in 5,850 8,671 14,210 16,200 11,659 2,090 2,265 2,761 3,726 4,965
2023. 1,677 1,622 1,851 2,171 2,960

Specialty Technology Highlights

● 5nm FinFET Automotive (N5A) technology, an automotive qualified version of 5nm technology (N5)
with automotive design enablement platform, completed technology and IP AEC-Q100 qualification
and certified by ISO 26262: Functional Safety – Road Vehicles Standard in 2022. Customer product
tape-outs are expected to start in 2023.
● N6 radio frequency (N6 RF) technology received multiple customer product tape-outs in 2022. In

addition, the second generation N6 radio frequency (N6 RF+) technology is under development, and
its process design kit (PDK) is expected to be completed in 2023.
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
● 16FFC embedded magnetoresistive random access memory (MRAM) technology completed reliability
Total Assets Total Equity
qualification in 2022, with one million cycles endurance and reflow capability. This technology is
ready for production and is expected to pass AEC-Q100 Grade-1 reliability qualification in 2023.

Capital Expenditures R&D Expenditures

Advanced Packaging Technology Highlights
 Unit: NT$ Billion  Unit: NT$ Billion
● TSMC-SoIC® (System on Integrated Chip) Chip-on-Wafer (CoW) technology successfully entered
316 460 507 839 1,083 86 91 109 125 163
volume production in 2022. Stacking SRAM chips on logic wafers through CoW technology
demonstrates significant performance improvement. In addition, TSMC-SoIC® Wafer-on-Wafer
(WoW) technology demonstrated superb system performance enhancement for high performance
computing (HPC) products in 2022 by stacking 7nm logic wafer on deep trench capacitor (DTC)
wafer.
● Chip on wafer on substrate with redistribution layer interposer (CoWoS®-R) technology featuring

redistribution layer (RDL) interposer for better signal integrity for HPC applications successfully started
risk production in 2022 and is expected to start volume production in 2023.
● Integrated Fan-Out with local silicon interconnect (InFO_LSI) technology, which integrates 5nm

SoCs with ultra-high density die-to-die interconnects for high performance computing products,
2018 2019 2020 2021 2022 2018 2019 2020 2021 2022
successfully started volume production in 2022.

10 11
 3 Market Overview High Performance Computing (HPC)
● 

The HPC platform includes PCs, tablets, game consoles, servers, base stations and more. Major HPC
unit shipments declined 11% in 2022 due to prolonged high inflation, macro-economic uncertainty
and inventory overbuilt, all resulting in weak demand on the consumer side. Meanwhile, the server and
TSMC estimates that the worldwide semiconductor market excluding memory reached US$492
data center upgrade cycle remained relatively healthy to accommodate rapidly growing data traffic and
billion in revenue in 2022, representing a 10% increase from 2021. In the foundry segment of the
to fulfill the expanding needs of AI applications and continued 5G base station deployment.
semiconductor industry, total revenue rose to US$130 billion in 2022, a robust growth of 28% over
2021.
Although the trend toward accelerated digitalization stimulated by the COVID-19 pandemic has
induced a structural increase in HPC-related semiconductor demand, the economic headwinds cited
In 2022, TSMC’s solid growth in the foundry segment was fueled by strong, broad based market
above will increasingly dampen demand on both consumer and enterprise sides and, as a result,
demand. Industry megatrends, such as 5G, artificial intelligence (AI) proliferation, and the accelerating
TSMC projects another year of low teens decline in HPC unit shipments in 2023. Longer term, an
digital transformation, drove increased demand across all major markets: smartphones, high
increasingly intelligent and more connected 5G world will fuel massive requirements for computation
performance computing (HPC), Internet of Things (IoT), and automotive. However, the electronics
power as well as a great need for energy-efficient computing. These require higher performance and
supply chain was also carrying high levels of excess inventory, accumulated over the past two years
more power-efficient CPUs, GPUs, NPUs, AI accelerators, and related-ASICs, which will drive the overall
due to supply uncertainties. Hence, in the second half of 2022, the electronics supply chain entered an
HPC platform towards richer silicon content, more advanced process technologies and advanced 3D
inventory correction period, which impacted the foundry segment and TSMC growth.
packaging. These trends are all favorable to TSMC given our technology leadership in these areas.
Looking ahead, TSMC expects the inventory correction to continue into 2023, primarily in the first
Internet of Things (IoT)
● 
half of the year. Furthermore, concerns about inflation and slowing economic growth will likely have
a dampening impact on discretionary consumer spending, reducing overall demand for electronic The IoT platform includes various types of “smart” connected devices ranging from wearables, health
devices. Against these two headwinds, TSMC projects mid-single-digit decline for the worldwide monitors and speakers to home automation devices, city and manufacturing automation devices.
semiconductor market excluding memory in 2023. For the longer term, driven by increasing As the COVID-19 pandemic changed individual life and work styles and accelerated the digital
semiconductor content in most electronic devices, continued market segment share gains by fabless transformation in enterprises, IoT unit shipments grew 18% in 2022, with smart health devices, smart
companies, increases in integrated device manufacturer (IDM) outsourcing, and the expanding use of retail, and smart manufacturing as the major growth drivers.
in-house application-specific integrated circuits (ASIC) by systems companies, TSMC expects foundry
segment revenue to outpace the mid- single-digit compound annual growth rate projected for the While these trends remain strong, TSMC believes demand for consumer-related IoT devices will be
worldwide semiconductor market excluding memory from 2022 through 2027. somewhat tempered by high inflation and projects unit shipment growth in the low teens in 2023.
Overall, as IoT devices take on more AI functions, they will require higher performance but lower power
As an upstream supplier in the semiconductor supply chain, the foundry segment is tightly correlated controllers, connectivity ICs and various types of sensors. TSMC offers the industry's most advanced
with the market health of all major platforms including smartphones, HPC, the IoT, automotive, and technologies in these areas including ultra-low power (ULP) and various specialty process technologies
digital consumer electronics (DCE). to help customers meet demand, fulfill ESG requirements and succeed in the marketplace.

Smartphones
●  Automotive
● 

Due to the combined impact of the COVID-19 pandemic, the Russo-Ukrainian war and generally higher With generally improving chip availability, worldwide car unit production grew 7% in 2022 but was
inflation, smartphone unit shipments declined 11% in 2022, reflecting a slowdown in the pace of 5G still held back by supply chain disruptions caused by the Russo-Ukrainian war and sporadic lockdowns
commercialization and thus prolonging the replacement of 4G. As this situation is likely to persist, due to the spread of COVID-19 particularly in China. The ongoing headwinds of high inflation and
TSMC projects a continued low-single-digit decline for the smartphone market in 2023. Over the longer macro-economic uncertainty are expected to hold global car unit production to low-single-digit growth
term, however, the inevitable migration to 5G, together with improved performance, longer battery in 2023 as well.
life, biosensors and more AI features, will all continue to propel smartphone sales going forward.
The entire automotive industry is moving toward “greener, safer and smarter,” which will accelerate
High performance and power efficient IC technologies are essential requirements among handset the adoption of electric vehicles (EVs), advanced driver assistance systems (ADAS) and smart cockpit/
manufacturers, and highly integrated chips and advanced 3D packaging designs are the preferred infotainment systems, along with new electrical/electronic (E/E) architecture. All these will lead to
solutions to optimize cost, power and form factor (IC footprint and thickness). The migration to increased demand for AP/MCU/ASIC processors, in-car networking, sensors, and power management
advanced process technologies will certainly continue spurred by the need for higher performance ICs, thus continuously increasing the silicon content per car. TSMC offers a wide variety of relevant
chips to run AI applications and various complex software computations as well as higher resolution process technologies to enable customers to deliver competitive products in the automotive market.
video. TSMC is an acknowledged leader in process technology for manufacturing highly integrated
chips and advanced 3D packaging designs and as such is very well positioned to serve the evolving
smartphone market.

12 13
 Digital Consumer Electronics (DCE)
● 

Logistical disruptions such as port congestion led to prolonged lead times in the TV supply chain
4 TSMC’s Trinity of Strengths
causing major electronics retailers to over-order and create excess inventory in 2022. At the same time,
inflation, rate hikes and the China lockdown due to its zero-COVID policy weakened demand for TVs,
TSMC’s growth has outperformed the overall semiconductor industry for all but two years since the
set-top boxes (STB) and other consumer products. As a result, the total DCE market fell by 11% in
company’s founding. We have been able to achieve this track record by unleashing the innovation
2022.
of our customers. We do not compete with our customers but support them as they grow, and
participate in their success as they flourish. Our ability to unleash innovation is rooted in our trinity of
While some high-end areas such as large screen, 120Hz/144Hz high frame rate TV, voice AI control
strengths: Technology Leadership, Manufacturing Excellence, and Customer Trust.
and WiFi 6 connectivity will continue to show good growth, fears of economic recession may stifle
overall recovery. As a result, TSMC forecasts a low-single-digit decline in global DCE unit shipments in
Each component of the trinity plays a critical part. Our Technology Leadership allows us to
2023. Regardless of the timing of the recovery, TSMC advanced technologies will continue to enable
provide leading-edge technologies to serve the most advanced product designs, and also enables
DCE customersTechnology
to create and differentiateManufacturing
their innovative products. Customer
a broad portfolio of specialty processes offerings for a diverse spectrum of IC designers. Our
Leadership
Technology Excellence
Manufacturing Trust
Customer
Manufacturing Excellence offers customers the fastest time-to-volume for their products and gives
Leadership Excellence Trust
>280 >15M >12,600 us the flexible capacity to not only manufacture for the foundry segment’s largest customer base,

>280
Technologies >15M
12” equivalent wafers >12,600
Customer Products
but also to provide more capacity when their products succeed and begin to generate high demand.
Finally, Customer Trust keeps the goals of TSMC and its customers aligned, because we do not believe
Technologies 12” equivalent wafers no competition
Customer with
Products long-term success is possible if our customers do not succeed.
customers
no competition with
customers Technology Leadership

As a semiconductor industry leader, TSMC provides the broadest range of advanced, specialty and
advanced packaging technology services. Our technology offerings possess the breadth of specialty
technologies to suit the needs of a broad array of customers, and our leading-edge technology
development has the depth to give customers a head start in the next wave of fast-growing product
segments. We commit considerable resources to maintain this competitive advantage in technology. In
2022, TSMC’s R&D spending totaled approximately US$5.47 billion, or 7.2% of revenues.

Comprehensive Technology Portfolio

2nm

3nm
2nm

3nm
5/4nm

5/4nm
7/6nm

16/12nm
7/6nm

16/12nm
20nm

20nm
22nm

22nm
28nm

40nm
28nm

40nm
65/55nm

90/80nm
65/55nm

90/80nm
0.13/0.11µm

0.13/0.11µm
0.18/0.15µm

0.18/0.15µm
0.25µm

0.35µm
0.25µm

0.35µm
>0.5µm

>0.5µm

MEMS Image Sensor Embedded RF Logic Analog High Voltage BCD-

NVM Power IC
MEMS Image Sensor Embedded RF Logic Analog High Voltage BCD-
NVM Power IC

Available In Development

Available In Development
14 15
 Faced with the continuous challenge to significantly scale up semiconductor computing power every TSMC has also integrated new applications such as intelligent mobile devices, IoT, edge computing,
two years, thereby extending Moore’s Law, the Company has focused its R&D efforts on contributing and mobile robot, with intelligent automated material handling systems (AMHS) to consolidate wafer
to customers’ product success by offering leading-edge technologies and design solutions. In 2022, manufacturing data collection and analysis, utilize manufacturing resources efficiently, and maximize
the Company successfully started risk production of N3E, an enhanced version of N3 technology; while manufacturing effectiveness. TSMC continues to intellectualize semiconductor production through
the development of 2nm, moved into baseline setup and the yield learning stage. Furthermore, the AI that processes massive amounts of production data to achieve agile and intelligent operations. In
Company’s research efforts continued pushing forward with exploratory studies for nodes beyond addition, TSMC has implemented augmented reality (AR) technology to improve equipment installation
2nm. efficiency and assist equipment engineers to diagnose remotely during the COVID-19 pandemic.

In addition to complementary metal oxide semiconductor (CMOS) logic, TSMC conducts R&D on a wide TSMC Trinity of Strengths Enables Us to be Everyone’s Foundry
range of other semiconductor technologies that provide the functionality required by customers for
mobile SoC and other applications. Highlights in 2022 included:

Technology Manufacturing Customer

● The Company’s integrated interconnect and packaging solution, 3DFabricTM, showed significant
Leadership Excellence Trust
progress by completing certification of HBM3 (third generation HBM) on CoWoS-S; qualifying
InFO_PoP Gen-8 for mobile applications and enhanced thermal performance; and developing
next-generation InFO_PoP with backside redistribution layers on schedule.
>280 >15M >12,600
● In specialty technologies, examples of progress included: improving figure-of-merit of 5V devices 12” equivalent Customer Products
Technologies
wafers no competition with
of 55nm bipolar-CMOS-DMOS (BCD) technology and extended 0.13μm BCD technology to support customers
55V in automotive applications; qualifying next generation monolithic CMOS-MEMS technology with
highly reliable 6-axis inertial measurement unit (IMU); starting risk-production of the world’s smallest
chips of voltage domain global shutter CMOS image sensors with 3-wafer stack technology; and
demonstrating next generation MRAM with smaller cell size, faster writing speed and more power
saving for use in MCU, AR/VR/edge-AI applications.
Customer Trust
TSMC’s design enablement team also provides customers with comprehensive support to optimize
Customer Trust is deeply ingrained as one of TSMC’s four core values and is our keystone to unleashing
design productivity and reduce cycle time, enabling their products to go from the designer’s desk to
innovation. It ensures that we win together with our customers in long-term relationships that last
the marketplace is as short a time as possible. Our design support includes design flows for electronic
from one generation of technology to another. A critical foundation stone for customer trust is a
design automation (EDA); silicon-proven IP building blocks, process design kits (PDKs), and technology
commitment TSMC made when it first opened for business: to never compete with customers. As a
files. As of 2022, the Company has expanded its library and silicon IP portfolio to contain more than
result, TSMC does not design IC products, but chooses to focus all of its resources on serving as the
55,000 items, a 37.5% increase over 2021, and has provided customers more than 43,000 tech files
trusted foundry partner for its customers.
and 2,900 PDKs.

The dedicated foundry business model gives TSMC a distinct advantage over IDM foundries which give
Manufacturing Excellence
priority to manufacturing its own IC products over those of its customers. Customers that work with
TSMC deployed 288 distinct process technologies, and manufactured 12,698 products for 532 TSMC will not need to be concerned that their products will compete with their foundry’s products
customers in 2022, making it the world’s most diversified and largest provider of logic IC capacity. in the marketplace. Nor will they need to worry that their capacity needs will take a back seat to the
TSMC’s unique manufacturing system is tailored to manage the diverse manufacturing requirements capacity needs of the IDM’s products.
of each customer, product, and technology without compromising speed, precision, and flexibility to
adapt to changing circumstances. At the same time, our people and systems deliver these results in the TSMC’s engagement with customers begins at the earliest stages of R&D to understand their
leanest and most efficient way possible to support TSMC’s profitability. technology needs, and continues through to design support, mask making, manufacturing, and
packaging and testing. Along the way, customers can call on the support of a dedicated customer
The Company’s use of sophisticated, agile and intelligent operating systems drives manufacturing service team, as well as 24-hour a day, seven-day-a-week access to real-time information through
excellence. TSMC has integrated intelligent process experience, machine tuning, manufacturing TSMC-Online, a suite of web-based applications that facilitates design, engineering, and logistics
know-how, and artificial intelligence technologies to create an intelligent manufacturing environment. collaboration. From the fundamental tenets of TSMC’s business model to the fine-grained details of
Intelligent manufacturing technologies are widely applied to enhance lean manufacturing, boost doing business together, customers can be assured that TSMC is committed to winning together with
employee and equipment productivity, and improve process and equipment control, quality control, them.
and robotic control. The end result is real-time information analysis, improved forecast capability,
maximum cost effectiveness, and accelerated innovation.

16 17
 5 Corporate Governance 6 Environmental, Social and Governance
TSMC advocates and acts upon the principles of operational transparency and respect for shareholder As a long-term trusted technology and capacity provider of the global logic IC industry, TSMC is
rights. We believe that the basis for successful corporate governance is a sound and effective Board dedicated to environmental, social and governance (ESG) issues. The Company collaborates with all
of Directors. In line with this principle, TSMC Board of Directors set up the “Audit Committee” and stakeholders – employees, shareholders/investors, customers, suppliers/contractors, government/
the “Compensation Committee” in 2002 and 2003 respectively. To continue to make our corporate industry associations and society – to create sustainability value by pursuing three primary missions:
governance more comprehensive, the TSMC Board took a step further in February 2023 to expand acting with integrity, strengthening environmental protection, and caring for the disadvantaged.
and strengthen the functions and responsibilities of its committees, including renaming the “Audit
Committee” to the “Audit and Risk Committee”, and the renaming the “Compensation Committee” to TSMC’s ESG Management
the “Compensation and People Development Committee”. It also established a “Nominating, Corporate
The ESG Steering Committee is chaired by TSMC’s Chairman, while the Chairperson of the ESG
Governance and Sustainability Committee” of the Board of Directors. Each Committee supports the
committee serves as Executive Secretary, and senior executives from a wide variety of functions – all
Board to fulfill its responsibilities and each Committee’s chairperson regularly reports to the Board on
work together to examine ESG material issues in relation to the Company’s operations, set the short-,
its activities and recommendations.
medium- and long-term strategic directions that link to the UN’s sustainable development goals
(SDGs).
Board of Directors

TSMC’s Board of Directors consists of ten distinguished members with a great breadth of experience The ESG Committee functions to coordinate and integrate resources, and facilitate the communications
as world-class business leaders or professionals. We deeply rely on them for their diverse knowledge, among different divisions, implementing the resolutions of the Company’s ESG Steering Committee.
personal perspectives, and solid business judgment. Six of those ten members are Independent ESG Department, on behalf of the ESG Committee, works together with cross-organizational
Directors: former British Telecommunications Chief Executive Officer, Sir Peter L. Bonfield; former representatives to identify key sustainability issues in relation to the Company’s operations and
Chairman of National Performing Arts Center and former Advisor of Executive Yuan, R.O.C., Ms. stakeholders’ concern. Task forces are formed based on various issues to frame adaptive strategies,
Kok-Choo Chen; former Chairman of Applied Materials, Inc., Mr. Michael R. Splinter; former Chief goals and action plans. The committee holds quarterly meetings to track progress and ensure the
Executive Officer of Xilinx, Inc., Mr. Moshe N. Gavrielov; currently Chairman of Delta Electronics Inc., strategies are implemented effectively in daily operations.
Mr. Yancey Hai; and former President of MIT, Mr. L. Rafael Reif.
The Board of Directors supervises and guides the Company’s sustainability management, strategies,
TSMC’s Board is comprised of a diverse group of professionals from different backgrounds in and goals. The ESG Committee Chairperson reports quarterly to the Board of Directors on the
industries, academia, law, etc. These professionals include citizens from Taiwan, Europe and the implementation of plans and results.
U.S. with world-class business operating experience, one of whom is female. Independent Directors
constitute 60% of the Board. In 2022, TSMC focused primarily on green manufacturing and supply chain management (including
net zero emission, renewable energy access and use, and low-carbon value chain management),
Inheriting the spirit of TSMC’s Founder, Dr. Morris Chang’s philosophy on corporate governance, enhancement of workplace diversity and inclusion, talent development (including employee resource
under the leadership of Chairman Dr. Mark Liu and CEO & Vice Chairman Dr. C.C. Wei, TSMC’s Board groups, diversity and inclusion practices for R&D talents, Science, Technology, Engineering, and
of Directors takes a serious and forthright approach to its duties and is a dedicated, competent and Mathematics (STEM) programs for high school girls), making sustainability disclosures in sustainability
independent Board. report, theme reports such as UN SDGs Action Report and Materiality Analysis Report, performing
sustainable culture advocacy (i.e., TSMC ESG awards), empowerment projects in remote areas and
The Board’s primary duty is to supervise the Company’s compliance with relevant laws and regulations, 2021 ESG spending updates, etc.
financial transparency, timely disclosure of material information, and maintaining of the highest
integrity. TSMC’s Board of Directors strives to perform these responsibilities through its Audit Committee ESG Highlights in 2022
and the Compensation Committee, the hiring of a financial expert consultant for the Audit Committee,
Reclaimed Water Plants
and coordination with our Internal Audit department. The second duty of the Board of Directors
is to appoint and dismiss officers of the Company when necessary, to evaluate the management’s In September 2022, the TSMC Southern Taiwan Science Park Reclaimed Water Plant commenced
performance and to review the succession plan for senior executives. TSMC’s management has operation, supplying 10,000 metric tons per day of industrial reclaimed water by the end of the year,
maintained a healthy and functional communication with the Board of Directors, has been devoted in and expected to reach 36,000 metric tons per day by 2026. Built in collaboration with CTCI Co, it is
executing guidance of the Board, and is dedicated in running the business operations, all to achieve the first industrial reclaimed water plant in the world dedicated to supplying advanced semiconductor
the best interests for TSMC shareholders. The third duty of the Board of Directors is to resolve critical processes, and will serve as a model for future reclaimed water plants at other TSMC sites.
matters, such as capital appropriations, investment activities, dividends, etc. The fourth duty of the
Board of Directors is to provide guidance to the Company’s management team and risk management. In 2022, TSMC also initiated the Hsinchu Science Park Reclaimed Water Plant Project, which is
In each quarter, TSMC’s management reports to the Board on various subjects (including ESG programs) scheduled to supply 10,000 cubic meters per day of industrial reclaimed water in 2025 for 2nm
and strategies, and spends substantial time and effort to communicate with the Board. The Board would process fabs along with municipal reclaimed water supply. In the future, new TSMC fabs in Hsinchu
comment on the risk and probabilities for success of the proposed corporate strategies. The Board also
periodically oversees those strategies’ implementation and outcomes, and may suggest the management
team to make adjustments to the strategic goals and objectives if necessary.
18 19
 Science Park will use 100% reclaimed water. The aim is to achieve an over 60% replacement rate of
reclaimed water for fabs in Taiwan by 2030, to enhance operational resilience and ensure sustainable
action towards water recycling.
7 Financial Statements
AI-Powered Water Chiller System
Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries

TSMC continues to optimize the energy-saving model of its chiller water system through machine Consolidated Condensed Balance Sheets
learning methods, successfully developing three innovative functions including “single chiller December 31, 2018 - 2022
compressor abnormal energy consumption detection,” “multi-chiller compressor operating load (In Millions of New Taiwan Dollars (NTD) and U.S. Dollars (USD))
precision forecast,” and “chiller water system pressure control optimization.” TSMC introduced the
2022 2021 2020 2019 2018
three functions to Fab 15A in January 2022, saving two million kWh of electricity and reducing 1,000
USD NTD NTD NTD NTD NTD
metric tons of carbon by November 2022. In 2023, all TSMC 12-inch wafer fabs in Taiwan will begin
ASSETS
to adopt the three functions, which will also be incorporated as standard designs for new plants. These Current Assets
initiatives are expected to save 100 million kWh of electricity per year and reduce carbon by 50,000 Cash and Cash Equivalents $43,721 $1,342,814 $1,064,990 $660,171 $455,399 $577,815
metric tons. Investments in Marketable Financial Instruments 7,120 218,672 123,465 131,306 128,049 117,367
Accounts Receivable 7,532 231,340 198,302 146,038 139,771 129,198
Inventories 7,201 221,149 193,102 137,353 82,981 103,231
Third TSMC ESG Award Other Current Assets 1,267 38,922 27,214 17,317 16,414 24,069
Total Current Assets 66,841 2,052,897 1,607,073 1,092,185 822,614 951,680
To promote sustainability, TSMC’s ESG Steering Committee, led by Chairman Dr. Mark Liu, presented
the third TSMC ESG Award in 2022, honoring internal organizations and divisions for tangible Non-current Assets
achievements in the Company’s five ESG strategic directions: Drive Green Manufacturing, Build a Long-term Investments 2,245 68,928 29,384 27,728 30,172 29,305
Responsible Supply Chain, Create a Diverse and Inclusive Workplace, Develop Talent, and Care For Property, Plant and Equipment 87,710 2,693,837 1,975,119 1,555,589 1,352,377 1,072,050
Right-of-use, Intangible and Other Non-current
The Disadvantaged. At the same time, this award presentation encouraged all employees to propose Assets 4,855 149,117 113,927 85,209 59,642 37,093
new ideas for sustainability to be assessed for feasibility and potential incorporation in the Company’s Total Non-current Assets 94,810 2,911,882 2,118,430 1,668,526 1,442,191 1,138,448

implementation plans. Compared with 1,257 sustainability proposals in the second year, the third
Total Assets $161,651 $4,964,779 $3,725,503 $2,760,711 $2,264,805 $2,090,128
annual ESG Award received 1,880 innovative ideas, adding new energy to the Company’s culture of
sustainability. LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term Loans $- $- $114,921 $88,559 $118,522 $88,755
Accounts Payable 1,840 56,522 48,723 41,095 40,206 34,357
Payables to Contractors and Equipment Suppliers 6,952 213,500 145,742 157,805 140,811 43,134
Cash Dividends Payable 4,644 142,617 142,617 129,652 129,652 -
Accrued Expenses and Other Current Liabilities 16,679 512,274 282,933 197,440 129,745 139,397
Current Portion of Bonds Payable and Bank Loans 629 19,314 4,567 2,600 31,800 34,900
Total Current Liabilities 30,744 944,227 739,503 617,151 590,736 340,543

Non-current Liabilities
Bonds Payable 27,166 834,336 610,071 254,105 25,100 56,900
Other Non-current Liabilities 7,349 225,727 205,196 38,833 26,874 15,189
Total Non-current Liabilities 34,515 1,060,063 815,267 292,938 51,974 72,089

Total Liabilities 65,259 2,004,290 1,554,770 910,089 642,710 412,632

Equity Attributable to Shareholders of the Parent

Capital Stock at Par Value 8,443 259,304 259,304 259,304 259,304 259,304
Capital Surplus 2,257 69,330 64,762 56,347 56,340 56,316
Legal Capital Reserve 10,131 311,147 311,147 311,147 311,147 276,034
Special Capital Reserve 103 3,154 59,304 42,259 10,675 26,907
Unappropriated Earnings 75,643 2,323,224 1,536,378 1,235,280 1,011,513 1,073,706
Others (668) (20,506) (62,609) (54,680) (27,569) (15,450)
Equity Attributable to Shareholders of the Parent 95,909 2,945,653 2,168,286 1,849,657 1,621,410 1,676,817
Noncontrolling Interests 483 14,836 2,447 965 685 679
Total Shareholders' Equity 96,392 2,960,489 2,170,733 1,850,622 1,622,095 1,677,496

Total Liabilities & Shareholders' Equity $161,651 $4,964,779 $3,725,503 $2,760,711 $2,264,805 $2,090,128

Note: Amounts in New Taiwan dollars have been translated into U.S. dollars at the rate of NT$30.713 for the year ended December 31, 2022.

20 21
 Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries Taiwan Semiconductor Manufacturing Company Limited and Subsidiaries
Consolidated Condensed Statements of Comprehensive Income Consolidated Condensed Cash Flow Statements
For the Years Ended December 31, 2018 - 2022 For the Years Ended December 31, 2018 - 2022
(In Millions of New Taiwan Dollars (NTD) and U.S. Dollars (USD), Except for Earnings Per Share) (In Millions of New Taiwan Dollars (NTD) and U.S. Dollars (USD))

2022 2021 2020 2019 2018 2022 2021 2020 2019 2018
USD NTD NTD NTD NTD NTD USD NTD NTD NTD NTD NTD
Net Revenue $ 75,881 $ 2,263,891 $ 1,587,415 $ 1,339,255 $ 1,069,985 $ 1,031,474 Cash Flows from Operating Activities:
Income Before Income Tax $ 38,351 $ 1,144,191 $ 663,126 $ 584,777 $ 389,845 $ 397,510
Cost of Revenue (30,687) (915,536) (767,878) (628,125) (577,283) (533,600) Depreciation & Amortization 14,656 437,254 422,395 331,725 286,884 292,546
Share of Profits of Associates (261) (7,799) (5,603) (3,593) (2,844) (3,058)
Gross Profit 45,194 1,348,355 819,537 711,130 492,702 497,874 Income Taxes Paid (2,902) (86,561) (83,498) (51,362) (52,044) (45,383)
Changes in Working Capital & Others 4,140 123,514 115,741 (38,880) (6,702) (67,661)
Operating Expenses Net Cash Generated by Operating Activities 53,984 1,610,599 1,112,161 822,667 615,139 573,954
Research and Development Expenses (5,472) (163,262) (124,735) (109,486) (91,419) (85,895)
Sales, General and Administrative Expenses (2,127) (63,446) (44,488) (35,570) (28,086) (26,254) Cash Flows from Investing Activities:
Total Operating Expenses (7,599) (226,708) (169,223) (145,056) (119,505) (112,149) Interest Received 606 18,084 5,991 9,775 16,875 14,660
Cash Dividend Received 101 3,016 2,499 3,487 2,039 3,421
Acquisitions of:
Other Operating Income and Expenses (12) (368) (333) 710 (496) (2,101)
Property, Plant and Equipment (36,289) (1,082,672) (839,196) (507,239) (460,422) (315,582)
Marketable Financial Instruments (7,971) (237,818) (259,688) (266,940) (257,997) (99,017)
Income from Operations 37,583 1,121,279 649,981 566,784 372,701 383,624
Proceeds from Disposal or Redemption of:
Property, Plant and Equipment 33 983 390 607 287 181
Non-operating Income and Expenses Marketable Financial Instruments 3,596 107,293 263,973 267,247 247,212 89,159
Share of Profits of Associates 261 7,799 5,603 3,593 2,844 3,058 7 186 (10,335) (12,719) (6,796) (7,091)
Others
Net Interest Income (Expenses) 358 10,672 294 6,937 12,939 11,643
Net Cash Used In Investing Activities (39,917) (1,190,928) (836,366) (505,782) (458,802) (314,269)
Other Gains and Losses 149 4,441 7,248 7,463 1,361 (815)
Total Non-operating Income and Expenses 768 22,912 13,145 17,993 17,144 13,886
Cash Flows from Financing Activities:
Increase (Decrease) in Short-term Loans (3,753) (111,960) 35,668 (31,572) 31,804 23,923
Income before Income Tax 38,351 1,144,191 663,126 584,777 389,845 397,510 Proceeds from Issuance of Bonds 6,646 198,293 364,593 236,726 - -
Repayment of Bonds (147) (4,400) (2,600) (31,800) (34,900) (58,025)
Income Tax Expenses (4,267) (127,290) (66,053) (66,619) (44,501) (46,326) Repayment of Long-term Bank Loans (6) (167) - - - -
Interest Paid (410) (12,219) (3,834) (1,781) (3,597) (3,233)
Net Income 34,084 1,016,901 597,073 518,158 345,344 351,184 Cash Dividends Paid for Common Stock (9,560) (285,234) (265,786) (259,304) (259,304) (207,443)
Repurchase of Treasury Stock (29) (872) - - - -
Other Comprehensive Income (Losses) 1,422 42,430 (7,619) (30,322) (11,824) 9,837 Others 547 16,315 8,567 (884) (3,642) (346)
Net Cash Used in Financing Activities (6,712) (200,244) 136,608 (88,615) (269,639) (245,124)
Comprehensive Income $35,506 $1,059,331 $589,454 $487,836 $333,520 $361,021
Effect of Exchange Rate Changes on Cash and Cash
Net Income Attributable to: Equivalents and Others 1,957 58,397 (7,584) (23,498) (9,114) 9,862
Shareholders of the Parent $ 34,072 $ 1,016,530 $ 596,540 $ 517,885 $ 345,264 $ 351,131
Noncontrolling Interests 12 371 533 273 80 53 Net Increase (Decrease) in Cash and Cash Equivalents 9,312 277,824 404,819 204,772 (122,416) 24,423
$34,084 $1,016,901 $597,073 $518,158 $345,344 $351,184
Cash and Cash Equivalents at Beginning of Period 35,696 1,064,990 660,171 455,399 577,815 553,392

Earnings per Share - Diluted (NT$) $1.31 $39.20 $23.01 $19.97 $13.32 $13.54
Cash and Cash Equivalents at End of Period $45,008 $1,342,814 $1,064,990 $660,171 $455,399 $577,815
Earnings per ADR - Diluted (US$) $6.57 $196.02 $4.12 $3.39 $2.15 $2.24
Note: Amounts in New Taiwan dollars have been translated into U.S. dollars at the weighted average rate of NT$29.835 for the year ended December 31, 2022.
Note: Amounts in New Taiwan dollars have been translated into U.S. dollars at the weighted average rate of NT$29.835 for the year ended December 31, 2022.

22 23
Contact Information
Taiwan Europe/North America

Corporate Headquarters & Fab 12A Fab 15B TSMC Europe B.V. TSMC Technology, Inc
8, Li-Hsin Rd. 6, Hsinchu Science Park, Hsinchu 300-096, 1, Xinke Rd., Central Taiwan Science Park, Taichung 428-015, World Trade Center, Zuidplein 60, 1077 XV Amsterdam, TTI
Taiwan, R.O.C. Taiwan, R.O.C. The Netherlands 2851 Junction Avenue, San Jose, CA 95134, U.S.A.
Tel: +886-3-5636688 Fax: +886-3-5637000 Tel: +886-4-27026688 Fax: +886-4-24630372 Tel: +31-20-3059900 Tel: +1-408-3828000
R&D Center & Fab 12B Fab 18A TSMC Design Technology Canada Inc. WaferTech, LLC
168, Park Ave. 2, Hsinchu Science Park, Hsinchu 300-091, 8, Beiyuan Rd. 2, Southern Taiwan Science Park, Tainan 1000 Innovation Drive, Suite 400, Kanata, ON K2K 3E7, 5509 N.W. Parker Street, Camas, WA 98607-9299, U.S.A.
Taiwan, R.O.C. 745-093, Taiwan, R.O.C. Canada Tel: +1-360-8173000 Fax: +1-360-8173009
Tel: +886-3-5636688 Fax: +886-3-6687827 Tel: +886-6-5056688 Fax: +886-6-5050363 Tel: +613-576-1990 TSMC Arizona Corporation
Fab 2, Fab 5 Fab 18B TSMC North America 5088 W. Innovation Circle, Phoenix, AZ 85083, U.S.A.
121, Park Ave. 3, Hsinchu Science Park, Hsinchu 300-096, 8, Beiyuan Rd. 2, Southern Taiwan Science Park, Tainan 2851 Junction Avenue, San Jose, CA 95134, U.S.A. Tel: +1 602-567-1688
Taiwan, R.O.C. 745-093, Taiwan, R.O.C. Tel: +1-408-3828000 Fax: +1-408-3828008
Tel: +886-3-5636688 Fax: +886-3-5781546 Tel: +886-6-5056688
Fab 3 Advanced Backend Fab 1
9, Creation Rd. 1, Hsinchu Science Park, Hsinchu 300-092, 6, Creation Rd. 2, Hsinchu Science Park, Hsinchu 300-077,
Taiwan, R.O.C. Taiwan, R.O.C. TSMC Spokesperson Common Share Transfer Agent and Registrar
Tel: +886-3-5636688 Fax: +886-3-5781548 Tel: +886-3-5636688 Fax: +886-3-5773628 Name: Wendell Huang Company: The Transfer Agency Department of CTBC Bank
Fab 6 Advanced Backend Fab 2 Title: Vice President & CFO Address: 5F, 83, Sec. 1, Chung-Ching S. Rd., Taipei
Tel: +886-3-5636688 Fax: +886-3-5637000 100-003, Taiwan R.O.C.
1, Nan-Ke North Rd., Southern Taiwan Science Park, Tainan 1, Sanbaozhu Rd., Southern Taiwan Science Park, Tainan
Email: press@tsmc.com Tel: +886-2-66365566 Fax: +886-2-23116723
741-014, Taiwan, R.O.C. 741-013, Taiwan, R.O.C.
TSMC Deputy Spokesperson Website: http://www.ctbcbank.com
Tel: +886-6-5056688 Fax: +886-6-5052057 Tel: +886-6-5056688 Fax: +886- 6-5057223
Name: Nina Kao ADR Depositary Bank
Fab 8 Advanced Backend Fab 3
Title: Head of Public Relations Division Company: Citibank, N.A.
25, Li-Hsin Rd., Hsinchu Science Park, Hsinchu 300-094, 101, Longyuan 6th Rd., Longtan Dist., Taoyuan City 325-002,
Tel: +886-3-5636688 Fax: +886-3-5637000 Depositary Receipts Services
Taiwan, R.O.C. Taiwan, R.O.C.
Email: press@tsmc.com Address: 388 Greenwich Street, New York, NY 10013,
Tel: +886-3-5636688 Fax: +886-3-5662051 Tel: +886-3-5636688 Fax: +886-3-4804250
Auditors U.S.A.
Fab 14A Advanced Backend Fab 5 Website: http://www.citi.com/dr
Company: Deloitte & Touche Tel: +1-877-2484237 (toll free)
1-1, Nan-Ke North Rd., Southern Taiwan Science Park, 5, Keya W. Rd., Central Taiwan Science Park, Taichung
Auditors: Mei-Yen Chiang, Shang-Chih Lin Tel: +1-781-5754555 (out of US) Fax: +1-201-3243284
Tainan 741-014, Taiwan, R.O.C. 428-303, Taiwan, R.O.C.
Address: 20F, No. 100, Songren Rd., Xinyi Dist.,Taipei E-mail: citibank@shareholders-online.com
Tel: +886-6-5056688 Fax: +886-6-5051262 Tel: +886-4-27026688 Fax: +886-4-25609631
110-016, Taiwan, R.O.C.
Fab 14B Advanced Backend Fab 6 Tel: +886-2-27259988 Fax: +886-2-40516888 TSMC’s depositary receipts of the common shares are
17, Nan-Ke 9th Rd., Southern Taiwan Science Park, Tainan No.1, Kezhuan 1st Rd., Zhunan Township, Miaoli County Website: http://www.deloitte.com.tw listed on New York Stock Exchange (NYSE) under the
741-014, Taiwan, R.O.C. 350-012, Taiwan, R.O.C. symbol TSM. The information relating to TSM is available
Tel: +886-6-5056688 Fax: +886-6-5055217 Tel: +886-3-5636688 at http://www.nyse.com and http://mops.twse.com.tw
Fab 15A VisEra Technologies Company Limited
1, Keya Rd. 6, Central Taiwan Science Park, Taichung 12, Dusing Rd. 1, Hsinchu Science Park, Hsinchu 300-096,
428-303, Taiwan, R.O.C. Taiwan, R.O.C.
Tel: +886-4-27026688 Fax: +886-4-25607548 Tel: +886-3-6668788 Fax: +886-3-6662858

Asia

TSMC China Company Limited TSMC Design Technology Japan, Inc.

4000, Wen Xiang Road, Songjiang, Shanghai, China 10F, Minatomirai Grand Central Tower, 4-6-2, Safe Harbor Notice:
Postcode: 201616 Minatomirai, Nishi-ku, Yokohama, Kanagawa, 220-0012, The statements included in this business overview that are not historical in nature are “forward-looking statements” within the meaning
Tel: +86-21-57768000 Japan of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. TSMC cautions readers that forward-looking
TSMC Nanjing Company Limited Tel: +81-45-6644500 statements are subject to significant risks and uncertainties and are based on TSMC’s current expectations. Actual results may differ
TSMC Japan 3DIC R&D Center, Inc. materially from those contained in such forward-looking statements for a variety of reasons including, among others, risks associated
16, Zifeng Road, Pukou Economic Development Zone,
with cyclicality and market conditions in the semiconductor industry; demand and supply for TSMC’s foundry manufacturing capacity in
Nanjing, Jiangsu Province, China 2F, 7D Bldg., West, 16-1 Onogawa, Tsukuba, Ibaraki, particular and for foundry manufacturing capacity in general; intense competition; the failure of one or more significant customers to
Postcode: 211806 305-8569, Japan continue to place the same level of orders with us; TSMC’s ability to remain a technological leader in the semiconductor industry; TSMC’s
Tel: +86-25-57668000 Tel: +81-29-893-2968 ability to manage its capacity; TSMC’s ability to obtain, preserve and defend its intellectual property rights; natural disasters and other
TSMC Korea Limited Japan Advanced Semiconductor unexpected events which may disrupt production; and exchange rate fluctuations. Additional information as to these and other risk factors
Rm 2104-2105 west, Hanshin Inter Valley 24 Building, Manufacturing, Inc. that may cause TSMC’s actual results to differ materially from TSMC’s forward-looking statements may be found in TSMC’s Annual Report
on Form 20-F, filed with the United States Securities and Exchange Commission (the “SEC”) on April 20, 2023, and such other documents
322, Teheran-ro, Gangnam-gu, Seoul 06211, Korea 6F, Shimotori NS Building 1-3-8 Shimotori, Chuo-ku,
as TSMC may file with, or submit to, the SEC from time to time. Except as required by law, we undertake no oblisgation to update any
Tel: +82-2-20511688 Kumamoto-shi, Kumamoto 860-0807, Japan
forward-looking statement, whether as a result of new information, future events, or otherwise.
TSMC Japan Limited
21F, Queen’s Tower C, 2-3-5, Minatomirai, Nishi-ku, “TSMC”, “tsmc”, “Open Innovation Platform”, “Open Innovation”, “GIGAFAB”, “CoWoS”, “TSMC-SoIC”, “3DFabric”, “TSMC 3DFabric” and “N12e”
Yokohama, Kanagawa, 220-6221, Japan are some of TSMC’s registered and/or pending trademarks used by the Company in various jurisdictions, including Taiwan. All rights reserved.
Tel: +81-45-682-0670 Copyright © 2022 by Taiwan Semiconductor Manufacturing Company, Ltd. All rights reserved.