TAIPEI (Taiwan News) — TSMC said Tuesday it will phase out its 6-inch wafer manufacturing within two years while streamlining 8-inch production.

The chipmaker cited market conditions and its long-term strategy as the basis for the decision, per CNA. It said it will work closely with customers to ensure a smooth transition and maintain service.

TSMC stressed the change will not affect its financial targets for the year. The company operates four 12-inch GigaFabs, four 8-inch fabs, and one 6-inch fab in Taiwan. Together with its subsidiaries, it expects to produce the equivalent of nearly 17 million 12-inch wafers this year.

The consolidation of 8-inch capacity is aimed at streamlining production and optimizing resources. TSMC said this will strengthen its competitive position in the global semiconductor market.

Meanwhile, the company reported a Q2 revenue of NT$933.79 billion (US$31.2 billion), net profit of NT$398.27 billion, and earnings per share of NT$15.36, per UDN. The board approved NT$618.9 billion in capital expenditure for Q3, aimed at expanding advanced process capacity and advanced packaging.