Taiwan Semiconductor Manufacturing Co. will invest an additional $100 billion in Arizona factories as artificial intelligence demand creates what the company calls a "multi-year megatrend" requiring massive capacity expansion.

The fresh commitment brings TSMC's total Arizona investment pipeline to $265 billion, Chief Financial Officer Wendell Huang told CNBC. The company also raised its full-year capital expenditure guidance to between $60 billion and $64 billion.

"We're seeing this strong-structure, multi-year demand, and we do not plan to leave any food on the table for anybody else," Huang said in the interview. "As long as the megatrend is right, then we're able to continue to deliver the profitable growth to our shareholders."

Racing to meet AI chip demand

TSMC is aggressively converting existing 5-nanometer capacity to the more advanced 3-nanometer node to support customers requiring cutting-edge processors for AI workloads. The smaller transistor size enables more powerful and efficient chips.

Phase one of the Arizona expansion, using 4-nanometer technology, is already operational and "going to be bigger and bigger in the next few quarters," according to Huang. The company's newest 2-nanometer technology began generating revenue in the second quarter and will drive growth in Q3.

Construction costs in the US run four to five times higher than Taiwan, Huang acknowledged. However, he said the expansion will ultimately strengthen the American semiconductor ecosystem through both front-end wafer fabrication and back-end advanced packaging facilities.

Managing China exposure

TSMC continues serving Chinese customers who contribute about 8% of total revenue while complying with all export controls, Huang said. The company sees minimal impact from component price increases due to its focus on high-end markets.

The chipmaker is also expanding into specialty technologies through a recent joint venture with Sony for image sensors, positioning for what Huang called "physical AI" applications.

TSMC shares closed down 7.29% Friday after rising 1.23% Thursday, but remain up 48% year-to-date as investors weigh the massive capital requirements against AI-driven revenue growth potential.