It’s becoming increasingly apparent that the manufacturing processes behind advanced processors are becoming prohibitively costly with technological advancements. A recent report by China Times has found that TSMC plans to increase the price of its next-generation N2 process node by over 50% compared to its predecessor, the N3 node. Currently, the N3P node sits at about 20% higher than the earlier N5 generation.

The rising costs are attributed to the need for improved machinery and materials, which require significant investments. For example, the cutting-edge machines required for the N2 node can cost up to $400 million a unit.

With companies like Apple, Nvidia, and AMD gearing up for orders of N2 wafers, it’s anticipated that these costs will inevitably trickle down to consumers. This suggests that, if significant price negotiations do not occur, prices for new CPUs and GPUs could see an upwards spike of nearly 80% depending on the node used in production. These advancements and pricing strategies underscore TSMC’s dominance in the semiconductor space and its ability to set prices in a largely competitive market.

In summary, significant price increases are on the horizon for top hardware components, raising concerns about consumer affordability as technology progresses.