Taiwan Semiconductor Manufacturing Co. is moving faster on its Arizona factory expansion as demand from Nvidia remains strong and Washington keeps pressure on advanced chip exports to China, according to people familiar with the matter.

The push underscores how the global semiconductor industry is being reshaped by U.S. industrial policy, security concerns, and supply chain competition. TSMC, the world’s largest contract chipmaker, is working to add capacity in the United States while managing tighter rules that affect the transfer of advanced equipment and technology to Chinese buyers.

The Arizona buildout is part of a broader effort to diversify chip production away from East Asia and bring more critical manufacturing onto U.S. soil. It also reflects the growing importance of high-end processors used in artificial intelligence systems, data centers, and other computing applications that continue to fuel demand from major customers such as Nvidia.

For TSMC, the challenge is balancing rapid expansion with shifting export controls and the high cost of building advanced fabs. For the U.S., the expansion offers a strategic win in semiconductor manufacturing, while for China it adds another layer of pressure in the contest over access to leading-edge chips and equipment.