The logo of Taiwan Semiconductor Manufacturing Company (TSMC) is seen during the opening ceremony of the TSMC global RnD Center in Hsinchu on July 28, 2023.
Amber Wang | Afp | Getty Images
Taiwan Semiconductor Manufacturing Co on Thursday reported a 77.4% jump in second-year profit, topping previous estimates as the world’s largest contractor continues to set a record-breaking streak.
Here are TSMC’s second quarter results versus LSEG SmartEstimates, which are based on forecasts from consistently accurate analysts:
- Revenue: 1.27 trillion New Taiwan dollars ($39.45 billion) compared to NT$1.264 trillion expected
- Net income: NT$706.56 billion vs. NT$632.64 billion expected
The company forecasts third-quarter revenue between $44.6 billion and $45.8 billion, with an operating margin of 56% to 58%. “AI-related demand continues to be very strong,” said TSMC Chairman CC Wei.
TSMC will invest an additional $100 billion in Arizona to meet strong customer demand, bringing its total investment in the state to $265 billion, Wei added.
“This is to create a wafer-thin fabric with a sense of several or more nanometers MP [mass production] technology, and advanced packaging materials to support strong multi-year demand from our leading US customers,” added Wei.
The company also increased its budget to between $60 billion and $64 billion this year as it continues to invest heavily to support customer growth, said CFO Wendell Huang.
The Taiwanese tech giant’s total revenue for the three months ended June rose to a record high for the fifth consecutive quarter, and was up 23.4% from the previous quarter.
TSMC is sitting on real profits but prefers not to use them fully, said Sravan Kundojjala, an analyst at SemiAnalysis. “Net, they have a lot more pricing power than they do now,” said Kundojjala, adding that although the chipmaker takes more value with the increase in selected prices, it is always done on purpose rather than the opportunity to keep healthy margins without pressuring customers.
Kundojjala said the memory boom is now straining TSMC’s non-AI business. “Consumer and price-sensitive end markets have been affected by rising memory prices and hard component supply.
Revenue rose to NT$1.27 trillion, a 36% jump from NT$933.79 billion in the same period last year. Advanced technology – 7 nanometers and below – accounted for 77% of total revenue, the company said.
5-nanometer process technology accounted for 33% of TSMC’s second-quarter revenue, followed by 3-nanometer at 30%, Huang said on an earnings call Thursday.
For 2026 revenue from the platform, the company said desktop computing accounted for 66% of revenue, followed by smartphones at 22% and the Internet of Things at 5%.
Asia’s most valuable company has been riding strong demand for AI chips for tech giants, including Nvidia, an apple and Broadcom saw shares gain 1.23% on Thursday. The stock is up more than 58% so far this year.
