TSMC posts sixth straight record profit on AI chip demand
TSMC reported a sixth consecutive quarter of record net profit, driven by strong demand for AI chips and advanced packaging. Net profit for July to September rose 69 per cent year on year to NT$763.1 billion, beating analyst forecasts. The company faces investor scrutiny over US interest rate concer
Taiwan Semiconductor Manufacturing Co (TSMC), the world's largest maker of advanced AI chips, reported a sixth consecutive quarter of record earnings on Thursday, propelled by booming infrastructure spending in the technology sector.
Analysts said demand for TSMC's AI chipmaking capacity and its advanced chip packaging technology, CoWoS, remains strong. The company, a key supplier to Nvidia and Apple, has become Asia's most valuable firm, with a market capitalisation of about US$2 trillion (HK$15.6 trillion), nearly double that of South Korean rival Samsung Electronics.
TSMC said net profit for the July-to-September quarter reached NT$763.1 billion (HK$184.82 billion), up 69 per cent from a year earlier and beating the NT$746.3 billion LSEG SmartEstimate compiled from 16 analysts. The result was its highest-ever quarterly net income and its 11th consecutive quarter of profit growth.
The company's earnings call, where it will provide fourth-quarter and updated full-year guidance, is scheduled for 0600 GMT. Investors are watching closely after the US Federal Reserve's interest rate hikes on Wednesday pummelled shares of AI stocks sensitive to higher borrowing costs. TSMC's Taipei-listed shares closed down 2 per cent on Thursday ahead of the earnings release, with the benchmark index off 3.4 per cent.
Last week, TSMC reported a 50 per cent year-on-year rise in third-quarter revenue, beating market forecasts and hitting a new record. The company is investing US$265 billion to build chip factories in Arizona, including an additional US$100 billion unveiled in July. In September, Reuters reported that TSMC was evaluating a potential investment in Texas, and Tesla CEO Elon Musk said his companies would build and operate the Terafab AI chip complex, with TSMC potentially subleasing part of it.
On its July earnings call, TSMC raised its capital expenditure forecast for this year to between US$60 billion and US$64 billion from a previous prediction at the high end of US$52 billion to US$56 billion. ASML, the world's largest maker of tools used to produce AI chips, said on Wednesday that customers were already looking to place orders for 2029 and 2030, easing concerns that the AI investment boom was losing momentum.
TSMC's Taipei-listed shares have gained 57 per cent so far this year, in line with a 62 per cent rise for the broader Taiwanese market.