Apple chipmaker TSMC is spending big on next-gen silicon, AI chips, and the U.S.

Main Apple chip partner TSMC had a great earnings report, and to keep up with demand, it is increasing its manufacturing spend by almost 40%. It's not clear how much this will benefit Apple.

The news comes after TMSC announced bumper quarterly results, which saw its profits increase by 35%. The company's strong performance is mostly thanks to the current AI boom, which has seen other chipmakers reap similar benefits.

Both TSMC in an earnings report transcript and The Economic Times report that TSMC expects record revenue, thanks, in part, to its place at the forefront of chip technologies.

"We expect our business to be supported by continuous strong demand for our leading edge process technologies," Wendell Huang, TSMC's chief financial officer, said in the conference call. He's clearly happy with the results and the future of the company.

But the company isn't resting on its laurels, with its spending expected to be "significantly higher" in the next three years.

TSMC said in the earnings call that billions will largely be spent on factories for fabricating and finishing AI chips for companies like Nvidia. But analysts, including Jim Cramer, continue to link TSMC's progress with a positive outlook for Apple.

There's no denying that Apple will benefit some from TSMC loosening the purse strings, some. TSMC already builds the chips that power its iPhones, iPads, Macs, and other devices.

It's just not at all clear how much of this investment is outside of "AI companies," as TSMC put it.

But Apple will certainly be the beneficiary of TSMC's $165 billion investment in the United States as it speeds up its plans to open new plants in Arizona. Revealed before the earnings, TSMC is now looking to create a new fabrication plant cluster that will help it meet growing demand in the future.

While there are rumors of Apple potentially using Intel foundries in the US to fabricate but not package its M7 chips, TSMC is very much a key partner for the company and has been for some time.

Even if Intel does pick up some of the slack in the US, TSMC Taiwan is still expected to produce the vast majority of Apple's chips. And, any chip it makes in the US still needs to be finished in Taiwan before use.

One of those chips is likely to be the M6, silicon that will power future MacBook Air and MacBook Pro laptops. Those chips are expected to be based on TSMC's 2nm manufacturing process, smaller than the M5's 3nm process.

It's this constant iteration that has seen TSMC become such a vital partner for Apple. It's no surprise to see TSMC looking to continue that pace by plowing more money into its research and development efforts.