It looks like global chipmaker TSMC is promoting its 40nm and 45nm fabrication processes through the expansion of its 12-inch facility, Fab 12, at the Hsinchu Science Park in Taiwan. Last month, it completed the fourth phase of its multi-phase expansion plan with Philips and has recently seen an influx of orders from Altera, AMD and Nvidia.

Among the rising proportion of sales for 40nm and 45nm circuits include FPGA chips, handset-based solutions, and GPUs. In the first quarter of this year, TSMC reported revenues of 1 percent for these fabrication processes and expects to see the proportion of total revenues for the two both reach around 8 to 10 percent by the end of the year. Market observers expect to see a further incline in sales to 15 to 20 percent in Q2 2010.

Just recently, the foundry announced that it bought $84 million dollars of new lithography equipment from ASML and Tokyo Electron, and we expect this to become a critical factor for its revenue goals in the near future. Company vice-president for human resources PH Chang confirmed that TSMC is preparing to hire several hundreds of new engineers at its 12-inch wafer facilities.

During Nvidia’s financial Q1 2010 earnings call last Friday, CEO Jen-Hsun Huang quoted, “TSMC is working very hard. We have a vast majority of their line cranking right now with new products, and so we are monitoring [40-nanometer] yields and they are improving nicely week-to-week-to-week…”

In perspective, Nvidia expects to see 30 percent of its chips at 40nm by the end of the year, while TSMC expects around 10 percent of its total revenue to come from 40nm and 45nm in the same timeframe.