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sPEG Index · member

TSMC

SDS 14/20 · [3 · 3 · 3 · 3 · 2] · ordinal

Advanced-process manufacturing and its qualification and design ecosystem, with advanced packaging as a related capability.

Reviewed 2026-09-17 · Next review 2026-12-16 · released speg-index-2026-09-17-v1

Five judgments

Constraint · Moderate

3/4

Few foundries can provide the relevant combined manufacturing, yield, and qualification capability at scale.

Counterevidence: Samsung reports active 2nm and HBM engagements and ramps, demonstrating competitive response without proving equivalent yield or scale.

Substitution resistance · Moderate

3/4

Customer process integration and design qualification impose substantial migration burden.

Counterevidence: Samsung reports active 2nm and HBM engagements and ramps, demonstrating competitive response without proving equivalent yield or scale.

Economic capture · Moderate

3/4

Reported operating margins show retained economics, though the packet does not isolate scarcity rent from cycle and mix.

Counterevidence: Samsung reports active 2nm and HBM engagements and ramps, demonstrating competitive response without proving equivalent yield or scale.

Persistence · Moderate

3/4

The qualification ecosystem supports a three-to-five-year path while rival ramps remain an explicit response.

Counterevidence: Samsung reports active 2nm and HBM engagements and ramps, demonstrating competitive response without proving equivalent yield or scale.

Cost of defense · Moderate

2/4

Large capital requirements and expected ramp dilution make retained economics sensitive to defense spending.

Counterevidence: Samsung reports active 2nm and HBM engagements and ramps, demonstrating competitive response without proving equivalent yield or scale.

Admission gates

dimension floors: pass — C/S/E/P meet 3 and D meets 2.
materiality: pass — Company-level materiality route is documented.
decisive confidence: pass — Every decisive dimension is at least Moderate confidence.
source packet: pass — Minimum admission packet is present for the draft judgment.
current review: pass — Structural review is current at the research cutoff.
material event: pass — No unresolved material eligibility event is recorded at the research cutoff.

Rationale, falsifiers, and next observation

14/20; include **Perimeter:** advanced process manufacturing and its qualification/design ecosystem, with packaging as a related capability. Q2 wafer mix was 77% at 7nm and below; this is wafer revenue, not consolidated revenue. The integrated-capability route supports company-level selection. Q2 revenue was $40.2bn, operating margin 60.3%; management reported $15.7bn quarterly capex and a $60–64bn annual capital budget. Management also anticipates margin dilution from new-node and overseas ramps. [T1–T3] **Judgment:** C3 reflects the combined manufacturing/qualification ecosystem and the existence of competing foundries. S3/E3/P3 recognize customer process integration and earnings retention with a reasoned three-to-five-year path. D2 captures the material cost of maintaining capability. Samsung's own results describe 2nm engagements and planned ramps, demonstrating an active competitive response rather than proving equivalent scale or yield. [X2] **Review/removal trigger:** rival production proves sufficiently substitutable at relevant performance/yield/scale, leading customers shift meaningful designs, or defense investment persistently consumes retained economics. Next review at results or by December 16. Geographic and customer concentration are additional risks, not score bonuses. A full capital-return comparison and customer-specific switching evidence remain incomplete.

Rival production proves substitutable at relevant yield, performance, and scale
Leading customers shift meaningful designs
Defense investment persistently consumes retained economics

Next: Update capital returns, customer switching evidence, rival yields, and overseas-ramp economics at results.

Valuation context

PEG: unavailable (qualified reference path not assembled). Economic sPEG: unavailable (paired valuation uncalibrated). SDS is not a valuation input.

Source packet

T1 · TSMC · TSMC Q2 results — Reported margins; fresh retrieval does not renew forecast vintage T2 · TSMC · TSMC Q2 earnings release — Wafer mix denominator distinguished T3 · TSMC · TSMC Q2 call — Capex and dilution are management disclosures; LSEG transcript hosted by issuer X2 · Samsung Electronics · Samsung Q2 results — Rival HBM/foundry activity; plans not equivalent qualified scale