[News] Broadcom Reportedly Flags TSMC Capacity as 2026 Bottleneck, With Lasers and PCBs Also in the Squeeze
While NVIDIA—reportedly TSMC’s largest customer—has repeatedly signaled it is pushing for additional wafer allocation amid tight supply, it is far from alone in feeling the strain. According to Reuters, citing Natarajan Ramachandran, director of product marketing in Broadcom’s Physical Layer Products division, TSMC is now approaching the limits of its production capacity.
Ramachandran told Reuters that the scenario marks a stark shift from just a few years ago, when he would have described the foundry giant’s capacity as effectively “unlimited.”
Despite TSMC’s ongoing expansion plans through 2027, Ramachandran warned the ramp-up is already falling short of near-term demand, characterizing the situation as a growing choke point that is “effectively a bottleneck—constraining, and in some respects choking, the supply chain in 2026,” according to Reuters.
This makes Hock Tan’s remarks on the company’s most recent earnings call all the more telling. In a transcript of reported by The Motley Fool, the Broadcom CEO revealed that the company had already moved to secure capacity for critical components—ranging from leading-edge wafers to high-bandwidth memory and substrates—through 2026 to 2028. In a way, that Broadcom felt compelled to lock in supply that far out speaks to just how tight the market has become.
Broadcom relies heavily on TSMC as a key foundry partner, with its ASIC (application-specific integrated circuit) designs for Google’s TPUs produced using TSMC’s advanced 3nm technology.
Supply Pressures Ripple Beyond Chips
Notably, Ramachandran highlighted that the supply crunch isn’t limited to semiconductors. Citing Reuters, he pointed out that even with multiple suppliers, bottlenecks are emerging in the laser component sector, while printed circuit boards (PCBs) have unexpectedly surfaced as another critical chokepoint.
Ramachandran, as per Reuters, further indicated that PCB makers across both Taiwan and China are grappling with capacity constraints, extending lead times and compounding supply chain pressures.
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(Photo credit: Broadcom)
