Sony Group and Taiwan Semiconductor Manufacturing Co. are preparing to invest roughly $6.3 billion, or about ¥1 trillion, in a joint venture that will mass-produce next-generation image sensors in Kumamoto Prefecture, Japan. Sony Semiconductor Solutions will hold approximately 60% of the venture, with TSMC owning the remaining 40%, and the companies expect production to begin in 2029.
The facility will be built in Kikuyo Town, near Sony's existing image sensor complex in Koshi, and will focus on chips built for what the two companies describe as "physical AI" — sensors used in autonomous vehicles, industrial robotics and AI-driven object recognition. Sony and TSMC signed a preliminary memorandum of understanding in May and expect to formally establish the joint venture by the end of Sony's fiscal year in March 2027.
Apple Supply First, Robotics Later
Initial output is expected to go mainly toward Apple's iPhone camera supply chain, according to reporting on the deal, before the venture shifts toward the broader physical AI applications the two companies are targeting later in the decade. Sony currently controls more than half of the global CMOS image sensor market, but its lead has narrowed as Samsung Electronics and China's OmniVision expand their own sensor output.
Sony Group Chief Executive Hiroki Totoki has described the venture as the company's "first step to becoming fab-light," pointing to a shift away from Sony fully owning and operating its own advanced fabrication capacity. Former Sony Semiconductor Solutions President Terushi Shimizu has gone further, calling the fab-light shift "only the first step" in a broader restructuring of how the unit manufactures chips. Sony and TSMC are also discussing potential subsidies for the project with Japan's Ministry of Economy, Trade and Industry, according to people familiar with the talks.
Sony has historically manufactured the bulk of its image sensors in-house, making the decision to bring in TSMC as a minority partner a notable departure for a business that remains one of the company's most profitable divisions.
Building on an Earlier Kumamoto Fab
The new venture builds on a prior collaboration between the two companies in the same prefecture. Japan Advanced Semiconductor Manufacturing, a TSMC-controlled logic-chip fab established in 2021, drew roughly $8.6 billion in investment and reached full-scale output by the end of 2024. The new image-sensor joint venture is close in scale to that earlier project, though it sits under different ownership terms, with Sony rather than TSMC holding the controlling stake.
The announcement comes about two weeks after a magnitude-7.1 earthquake struck Kumamoto on July 28, temporarily halting production at facilities operated by both Sony and TSMC in the region. Both companies said their plants remained structurally sound following the quake. Sony shares rose as much as 2.2% after news of the joint venture became public.