TSMC's Q3 Profit Surge Reflects Booming AI Chip Demand

Taiwan Semiconductor Eyes $23B in Q3 Revenue as AI Demand Soars - Taiwan Semiconductor (NYSE:TSM)

TSM has committed over $65 billion for U.S. plant expansions and is exploring new AI chip plants in Europe to meet growing demand. Taiwan Semiconductor Manufacturing Co TSM will likely report a third-quarter topline of $23.096 billion (versus $17.280 billion a year ago) and adjusted EPS of $1.80 on Thursday, according to analyst consensus estimates. The 34% revenue growth comes from the continued artificial intelligence frenzy and as countries remain engaged in consolidating their semiconductor base to reduce dependence on Asian countries like China. TSMC has guided for revenue of $22.4 billion-$23.2 billion. Last week, the company reported September topline growth of 39.6% to 251.87 billion Taiwanese dollars ($7.82 billion). Also Read: Nvidia, AMD Lead The Pack, Broadcom Stable, Intel Falters: Analyst's Latest Take Taiwan Semiconductor stock is up over 109% in the last 12 months. Global funds injected $29.5 billion of capital into the Taiwan Stock Exchange between January and September on a net basis despite selling $16.9 billion of shares, implying ample cash for investment in the stocks, Bloomberg reports. TSMC is a prime Nvidia Corp NVDA and Apple Inc AAPL chip supplier, and it remains invested in its geographical diversification, including the U.S., Japan, and Germany, signaling continued demand for its AI chips. Taiwan Semiconductor has already earmarked over $65 billion for three plants in Arizona, U.S. The contract chipmaker is eying more AI chip plants in Europe, Bloomberg cites from Taiwan's National Science and Technology Council Minister Wu Cheng-wen interview. Wu told Bloomberg that the AI market, including chips for Nvidia and Advanced Micro Devices Inc AMD, will be the most essential segment. He also hinted at the possible evaluation of expansion strategies in Europe. Price Action: TSM stock is up 0.87% at $192.47 at the last check on Monday. Also Read: Apple iPhone 16 Pro Boosts Sales, But Base Models Lag, Analyst Says Image via Shutterstock Market News and Data brought to you by Benzinga APIs

TSMC third-quarter profit seen jumping 40% on strong AI chip demand

TAIPEI (Reuters) - Taiwan Semiconductor Manufacturing Co, the main producer of advanced chips used in artificial intelligence applications, is expected to report a 40% leap in third-quarter profit on Thursday thanks to soaring demand. The world's largest contract chipmaker, whose customers include Apple and Nvidia, has benefited from the surge towards AI. TSMC is set to report a net profit of T$298.2 billion ($9.27 billion) for the quarter ended Sept. 30, according to a LSEG SmartEstimate drawn from 22 analysts. SmartEstimates give greater weighting to forecasts from analysts who are more consistently accurate. That estimate compares to the 2023 third-quarter net profit of T$211 billion. TSMC last week reported a jump in third-quarter revenue as reported in Taiwan dollars, comfortably beating market expectations. The company gives its revenue outlook in U.S. dollars at its earnings conference. "Most of TSMC's major clients, including Apple, Nvidia, AMD, Qualcomm and Mediatek are launching new products which heavily rely on TSMC's advanced process technologies," said Li Fang-kuo, chairman of President Capital Management. "TSMC's Q3 earnings will exceed expectations by a lot," Li added. TSMC, at its quarterly earnings call at 0600 GMT on Thursday, will update its outlook for the current quarter as well as for the full year, including its capital expenditure as it races to expand production. TSMC is spending billions building new factories overseas, including $65 billion on three plants in the U.S. state of Arizona, though it says most manufacturing will remain in Taiwan. On its last earnings call in July, TSMC raised its full-year revenue forecast and adjusted its capital expenditure plans for this year to between $30 billion and $32 billion, compared with a previous forecast of $28 billion to $32 billion. The AI boom has helped drive up the price of shares in Asia's most valuable company, with TSMC's Taipei-listed stock soaring 77% so far this year, compared with a 28% gain for the broader market. Hsinchu-headquartered TSMC, colloquially referred to the "sacred mountain protecting the country" for its crucial role in Taiwan's export-oriented economy, faces little competition. Once the dominant force in the semiconductor industry, five-decade-old Intel is facing one of its worst periods as losses mount at the contract manufacturing unit it is building out in hopes of challenging TSMC. (Reporting by Ben Blanchard and Faith Hung; Editing by Christopher Cushing)

TSMC third-quarter profit seen jumping 40% on strong AI chip demand

TAIPEI, Oct 14 (Reuters) - Taiwan Semiconductor Manufacturing Co (2330.TW), opens new tab, the main producer of advanced chips used in artificial intelligence applications, is expected to report a 40% leap in third-quarter profit on Thursday thanks to soaring demand. The world's largest contract chipmaker, whose customers include Apple (AAPL.O), opens new tab and Nvidia (NVDA.O), opens new tab, has benefited from the surge towards AI. TSMC is set to report a net profit of T$298.2 billion ($9.27 billion) for the quarter ended Sept. 30, according to a LSEG SmartEstimate drawn from 22 analysts. SmartEstimates give greater weighting to forecasts from analysts who are more consistently accurate. Advertisement · Scroll to continue That estimate compares to the 2023 third-quarter net profit of T$211 billion. TSMC last week reported a jump in third-quarter revenue as reported in Taiwan dollars, comfortably beating market expectations. The company gives its revenue outlook in U.S. dollars at its earnings conference. "Most of TSMC's major clients, including Apple, Nvidia, AMD (AMD.O), opens new tab, Qualcomm (QCOM.O), opens new tab and Mediatek (2454.TW), opens new tab are launching new products which heavily rely on TSMC's advanced process technologies," said Li Fang-kuo, chairman of President Capital Management. Advertisement · Scroll to continue "TSMC's Q3 earnings will exceed expectations by a lot," Li added. TSMC, at its quarterly earnings call at 0600 GMT on Thursday, will update its outlook for the current quarter as well as for the full year, including its capital expenditure as it races to expand production. TSMC is spending billions building new factories overseas, including $65 billion on three plants in the U.S. state of Arizona, though it says most manufacturing will remain in Taiwan. On its last earnings call in July, TSMC raised its full-year revenue forecast and adjusted its capital expenditure plans for this year to between $30 billion and $32 billion, compared with a previous forecast of $28 billion to $32 billion. The AI boom has helped drive up the price of shares in Asia's most valuable company, with TSMC's Taipei-listed stock soaring 77% so far this year, compared with a 28% gain for the broader market (.TWII), opens new tab. Hsinchu-headquartered TSMC, colloquially referred to the "sacred mountain protecting the country" for its crucial role in Taiwan's export-oriented economy, faces little competition. Once the dominant force in the semiconductor industry, five-decade-old Intel (INTC.O), opens new tab is facing one of its worst periods as losses mount at the contract manufacturing unit it is building out in hopes of challenging TSMC. ($1 = 32.1570 Taiwan dollars) Reporting by Ben Blanchard and Faith Hung; Editing by Christopher Cushing Our Standards: The Thomson Reuters Trust Principles., opens new tab

TSMC third-quarter profit seen jumping 40% on strong AI chip demand

Taiwan Semiconductor Manufacturing Co (TSMC) is expected to post a 40% increase in third-quarter profit driven by strong demand for AI applications. Key clients like Apple and Nvidia are heavily relying on TSMC's advanced technologies. TSMC's stock has surged 77% this year, outperforming the broader market.Taiwan Semiconductor Manufacturing Co, the main producer of advanced chips used in artificial intelligence applications, is expected to report a 40% leap in third-quarter profit on Thursday thanks to soaring demand. The world's largest contract chipmaker, whose customers include Apple and Nvidia, has benefited from the surge towards AI. TSMC is set to report a net profit of T$298.2 billion ($9.27 billion) for the quarter ended Sept. 30, according to a LSEG SmartEstimate drawn from 22 analysts. SmartEstimates give greater weighting to forecasts from analysts who are more consistently accurate. That estimate compares to the 2023 third-quarter net profit of T$211 billion. TSMC last week reported a jump in third-quarter revenue as reported in Taiwan dollars, comfortably beating market expectations. The company gives its revenue outlook in U.S. dollars at its earnings conference. "Most of TSMC's major clients, including Apple, Nvidia, AMD, Qualcomm and Mediatek are launching new products which heavily rely on TSMC's advanced process technologies," said Li Fang-kuo, chairman of President Capital Management. "TSMC's Q3 earnings will exceed expectations by a lot," Li added. TSMC, at its quarterly earnings call at 0600 GMT on Thursday, will update its outlook for the current quarter as well as for the full year, including its capital expenditure as it races to expand production. TSMC is spending billions building new factories overseas, including $65 billion on three plants in the U.S. state of Arizona, though it says most manufacturing will remain in Taiwan. On its last earnings call in July, TSMC raised its full-year revenue forecast and adjusted its capital expenditure plans for this year to between $30 billion and $32 billion, compared with a previous forecast of $28 billion to $32 billion. The AI boom has helped drive up the price of shares in Asia's most valuable company, with TSMC's Taipei-listed stock soaring 77% so far this year, compared with a 28% gain for the broader market. Hsinchu-headquartered TSMC, colloquially referred to the "sacred mountain protecting the country" for its crucial role in Taiwan's export-oriented economy, faces little competition. Once the dominant force in the semiconductor industry, five-decade-old Intel is facing one of its worst periods as losses mount at the contract manufacturing unit it is building out in hopes of challenging TSMC. ($1 = 32.1570 Taiwan dollars)

TSMC's Sales Beat Estimates in Good Sign for AI Chip Demand

(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. posted a better-than-expected 39% rise in quarterly revenue, assuaging concerns that AI hardware spending is beginning to taper off. The main chipmaker to Nvidia Corp. and Apple Inc. reported September-quarter sales of NT$759.7 billion ($23.6 billion), versus the average projection for NT$748 billion. Taiwan's largest company will disclose its full results next Thursday. The better-than-anticipated performance may reinforce the view of investors betting that AI spending will remain elevated as companies and governments race for an edge in the emergent technology. Others caution that the likes of Meta Platforms Inc. and Alphabet Inc.'s Google can't sustain their current pace of infrastructure spending without a compelling and monetizable AI use case. Hsinchu-based TSMC is one of the key companies at the heart of a global surge in spending on AI development, producing the cutting-edge chips needed to train artificial intelligence. Its sales have more than doubled since 2020, with the seminal launch of ChatGPT sparking a race to acquire Nvidia hardware for AI server farms. Shares in Nvidia were up about 1.2% in premarket trading in New York on Wednesday, while TSMC's US-traded ADRs rose a more modest 0.8%. What Bloomberg Intelligence Says This reflects strong demand for AI chips and new N3E process orders from Apple, Qualcomm and MediaTek, despite delays in shipments of Nvidia's Blackwell chips. Gross margin might also exceed the guidance midpoint of 54.5%. Focus in 3Q earnings call will be on whether 4Q guidance can exceed consensus' 7% sequential-growth estimate. While Apple's A18 chip orders may decline due to soft demand for new iPhone 16s, robust orders from Nvidia and Intel are likely to offset any revenue shortfall. Other key topics include the potential for earlier 2-nanometer (N2) node mass production and plans to expand its chip-on-wafer-on-substrate (CoWoS) advanced packaging capacity in 2025. TSMC's stock has more than doubled since the launch of ChatGPT, with its market capitalization briefly crossing the $1 trillion mark in July. That month, Taiwan's largest company also lifted its outlook for 2024 revenue growth after quarterly results beat estimates. In recent months, however, views have begun to diverge on whether the AI-driven growth momentum will last. That skepticism has led to a pullback in AI stocks, including flag bearer Nvidia, earlier this year. TSMC's view is that AI spending will remain high despite growing US-Chinese trade tensions. In both countries, startups and tech firms from Microsoft Corp. to Baidu Inc. are splurging on AI infrastructure in a race to develop applications. Nvidia's key server assembly partner Hon Hai Precision Industry Co. earlier this week also reaffirmed demand for AI hardware remains solid. Hon Hai Chairman Young Liu told Bloomberg TV on Tuesday that his company plans to boost server production capacity to meet "crazy" demand for the next-generation Blackwell chips, echoing similar remarks from Nvidia Chief Executive Officer Jensen Huang earlier this month. But analysts worry that delays in the delivery of Nvidia's latest Blackwell chips might disrupt the industry, though most investors don't view that as a long-term issue for TSMC. With Intel Corp. and Samsung Electronics Co. both struggling to get ahead in the business of bespoke chipmaking, TSMC's market leadership is expected to help prop up margins. TSMC now makes more than half of its revenue from high-performance computing, the segment of its business driven by AI demand. It also remains the sole manufacturer for the iPhone's processor, although a growing number of analysts have voiced concerns over worse-than-expected demand for the new iPhone 16 range. --With assistance from Vlad Savov. (Updates with shares and analyst's comment from the fifth paragraph)

TSMC third-quarter profit seen jumping 40% on strong AI chip demand

A Taiwan Semiconductor Manufacturing (TSMC) logo is seen at the TSMC Museum of Innovation in Hsinchu, Taiwan, May 29. Reuters-Yonhap Taiwan Semiconductor Manufacturing, the main producer of advanced chips used in artificial intelligence applications, is expected to report a 40 percent leap in third-quarter profit on Thursday thanks to soaring demand. The world's largest contract chipmaker, whose customers include Apple and Nvidia, has benefited from the surge towards AI. TSMC is set to report a net profit of T$298.2 billion ($9.27 billion) for the quarter ended Sept. 30, according to a LSEG SmartEstimate drawn from 22 analysts. SmartEstimates give greater weighting to forecasts from analysts who are more consistently accurate. That estimate compares to the 2023 third-quarter net profit of T$211 billion. TSMC last week reported a jump in third-quarter revenue as reported in Taiwan dollars, comfortably beating market expectations. The company gives its revenue outlook in U.S. dollars at its earnings conference. "Most of TSMC's major clients, including Apple, Nvidia, AMD , Qualcomm and Mediatek are launching new products which heavily rely on TSMC's advanced process technologies," said Li Fang-kuo, chairman of President Capital Management. "TSMC's Q3 earnings will exceed expectations by a lot," Li added. TSMC, at its quarterly earnings call at 0600 GMT on Thursday, will update its outlook for the current quarter as well as for the full year, including its capital expenditure as it races to expand production. TSMC is spending billions building new factories overseas, including $65 billion on three plants in the U.S. state of Arizona, though it says most manufacturing will remain in Taiwan. On its last earnings call in July, TSMC raised its full-year revenue forecast and adjusted its capital expenditure plans for this year to between $30 billion and $32 billion, compared with a previous forecast of $28 billion to $32 billion. The AI boom has helped drive up the price of shares in Asia's most valuable company, with TSMC's Taipei-listed stock soaring 77 percent so far this year, compared with a 28 percent gain for the broader market. Hsinchu-headquartered TSMC, colloquially referred to the "sacred mountain protecting the country" for its crucial role in Taiwan's export-oriented economy, faces little competition. Once the dominant force in the semiconductor industry, five-decade-old Intel is facing one of its worst periods as losses mount at the contract manufacturing unit it is building out in hopes of challenging TSMC. (Reuters)

TSMC's Sales Beat Estimates in Good Sign for AI Chip Demand

TSMC is the main chipmaker to Nvidia Corp. and Apple Inc. TSMC is Taiwan's largest company It will be disclosing its full results next week The Taiwan Semiconductor Manufacturing Co. (TSMC) posted a better-than-expected 39 percent rise in quarterly revenue, assuaging concerns that AI hardware spending is beginning to taper off. The main chipmaker to Nvidia and Apple reported September-quarter sales of TWD 759.7 billion (roughly Rs. 1,97,885 crore), versus the average projection for TWD $748 billion (roughly Rs. 1,94,838 crore). Taiwan's largest company will disclose its full results next Thursday. The better-than-anticipated performance may reinforce the view of investors betting that AI spending will remain elevated as companies and governments race for an edge in the emergent technology. Others caution that the likes of Meta Platforms and Alphabet's Google can't sustain their current pace of infrastructure spending without a compelling and monetisable AI use case. Hsinchu-based TSMC is one of the key companies at the heart of a global surge in spending on AI development, producing the cutting-edge chips needed to train artificial intelligence. Its sales have more than doubled since 2020, with the seminal launch of ChatGPT sparking a race to acquire Nvidia hardware for AI server farms. Shares in Nvidia were up about 1.2 percent in premarket trading in New York on Wednesday, while TSMC's US-traded ADRs rose a more modest 0.8 percent.

TSMC Sales Beat Estimates in Sign of Solid AI Chip Demand

Taiwan Semiconductor Manufacturing Co. posted a better-than-expected 39% rise in quarterly revenue, assuaging concerns that AI hardware spending is beginning to taper off. The main chipmaker to Nvidia Corp. and Apple Inc. reported September-quarter sales of NT$759.7 billion ($23.6 billion), versus the average analyst projection for NT$748 billion. Taiwan's largest company will disclose its full results next Thursday.

1 Top Artificial Intelligence (AI) Semiconductor Stock to Buy Hand Over Fist Before Oct. 17 | The Motley Fool

This AI stock has delivered impressive gains in 2024, and it could pop higher following its upcoming quarterly report. Artificial intelligence (AI) has played a central role in lifting semiconductor stocks over the past couple of years, which is evident from the tremendous 131% spike in the PHLX Semiconductor Sector index during this period. The good part is that the proliferation of this technology is set to drive stronger growth in this market, as AI adoption moves from data centers to edge devices such as smartphones, personal computers (PCs), and automotive applications, among others. For instance, the market for chips used in smartphones is expected to jump from $104 billion in 2023 to $146 billion next year. PC semiconductor spending, on the other hand, could jump to $107 billion in 2025 from $89 billion last year, while automotive market chip spending is forecast to jump to $104 billion next year from $79 billion last year. Meanwhile, spending on semiconductors deployed in AI servers and data centers is set to jump from $78 billion in 2023 to $136 billion next year. For investors looking to capitalize on all these fast-growing semiconductor end markets that have received a big boost thanks to AI, Taiwan Semiconductor Manufacturing (TSM 2.71%), popularly known as TSMC, seems like an ideal bet. The foundry giant serves all the verticals discussed, and the latest news from the company reinforces the fact that AI is turning out to be a solid growth driver for the company. Let's look at the reasons why. TSMC has just released its sales data for September, and the company has reported an impressive year-over-year increase of almost 40% in its monthly revenue to 251.8 billion New Taiwan (NT) Dollars. If we add the monthly revenue for July, August, and September, TSMC's Q3 revenue would come in at almost 760 billion NT Dollars, an impressive jump of 39% from the same period last year. That number is higher than analysts' Q3 revenue estimates of 748 billion NT Dollars. So, TSMC seems set to exceed Wall Street's expectations when it releases its third-quarter results on Oct. 17. Analysts have been forecasting $1.80 per share in earnings from the company, a jump of 40% from the same period last year, but the better-than-expected revenue growth is likely to translate into stronger bottom-line gains. Another thing worth noting is that TSMC's revenue in the first nine months of 2024 increased by 32% from the same period last year. This means TSMC is well on course to outpace the 26% revenue growth to $87.2 billion that analysts are expecting the company to deliver in 2024. More importantly, TSMC is expected to sustain healthy growth levels over the next couple of years as well. However, don't be surprised to see TSMC's revenue growth outpacing Wall Street's expectations. That's because the company is one of the most important pick-and-shovel plays in the massive AI space. It manufactures and fabricates chips for a range of fabless chipmakers such as Nvidia, AMD, Qualcomm, Broadcom, and Marvell Technology. Even better, chipmakers with fabrication plants of their own, such as Intel, are also turning to TSMC to capitalize on the latter's advanced chip manufacturing processes to produce more efficient, powerful chips. But that's not where TSMC's AI-related opportunity ends. The company also manufactures chips for Apple, putting it in position to make the most of the growth in AI smartphone sales. Now, a closer look at the customers discussed will make it clear that TSMC is one of the best ways to play the AI chip boom in different sectors. Nvidia, AMD, and Intel, for instance, are trying to make the most of the opportunities available in AI accelerators. Nvidia is running away with this market right now, making chips using TSMC's process nodes to deliver faster performance and lower power consumption than rivals. Qualcomm, AMD, and Intel are present in the AI-enabled PC market. Similarly, Qualcomm and Apple present avenues through which TSMC can tap the smartphone space. And finally, Marvell and Broadcom allow TSMC to tap into another fast-growing niche of AI semiconductors in the form of custom AI chips. Simply stated, it doesn't matter which of these companies wins more market share and ends up dominating their respective niches -- TSMC is most likely going to be the ultimate winner. That's why TSMC's advanced packaging technology that's used for producing AI chips is sold out until 2025. As a result, the company is expanding its capacity to produce AI chips a year ahead of the original schedule, according to Morgan Stanley. This should ideally allow TSMC to make more chips, fulfill more orders, and deliver stronger growth in revenue and earnings. This discussion makes it clear that TSMC is carrying terrific momentum going into its Q3 earnings report that's due on Oct. 17. There is a strong chance that it will beat consensus estimates and also deliver stronger-than-expected guidance for Q4, all of which could give the stock a nice shot in the arm. TSMC stock has jumped 77% this year already, and it looks all set to end the year on a strong note. Given that this AI stock is trading at an attractive 22 times forward earnings even after its outstanding run this year, buying it looks like a no-brainer right now considering that it seems built for more upside.