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TSMC's Quarterly Profit Tops Estimates as AI Chip Demand Stays Robust

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TSMC's Quarterly Profit Tops Estimates as AI Chip Demand Stays Robust

Taiwan Semiconductor Manufacturing (TPE:2330) posted a record second-quarter net profit as robust demand for artificial intelligence chips continued to fuel sales of its advanced semiconductor technologies.

The world's largest contract chipmaker reported second-quarter net income attributable to shareholders of NT$706.6 billion, up 77% from NT$398.3 billion a year earlier, according to a Thursday press release.

The result comfortably exceeded the FactSet consensus estimate of NT$624 billion.

Revenue rose 36% year over year to NT$1.270 trillion from NT$933.8 billion.

In dollar terms, revenue increased 34% to $40.2 billion, reaching the top end of the company's guidance of $39 billion to $40.2 billion.

Advanced technologies, defined as 7-nanometer and below, accounted for 77% of total wafer revenue during the quarter.

5-nanometer chips contributed 33% of wafer revenue, followed by 3-nanometer at 30%, 7-nanometer at 11%, and 2-nanometer node at 3%.

Last month, Chief Executive C.C. Wei said TSMC was working to keep pace with surging demand for artificial intelligence chips as customers remained optimistic about the technology's long-term growth prospects.

"Customer demand is so high, and we can only support so much. We are already working very hard," Reuters quoted Wei as saying.

Wei added that the rapid expansion of AI had strained suppliers across the semiconductor supply chain, with many companies struggling to keep up with demand.

He said TSMC was focused on ensuring it did not become a bottleneck as the AI boom continued.

Analysts expect TSMC to lift its full-year revenue outlook and are watching whether it also raises its 2026 capital spending plan, a key indicator of confidence in sustained AI demand.

Backed by strong demand, TSMC raised its full-year 2026 capital expenditure guidance to a range of $60 billion to $64 billion, up from its previous estimate of $52 billion to $56 billion.

TSMC is also accelerating its manufacturing expansion in the United States. The chipmaker confirmed plans to invest an additional $100 billion in its U.S. manufacturing operations, bringing its total planned investment in Arizona to $265 billion.

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