TSMC Posts Record Quarterly Profit as AI Chip Demand Accelerates

 

TSMC Sets New Earnings Record on Surging AI Chip Demand

Taiwan Semiconductor Manufacturing Company (TSMC) has delivered another record-breaking quarter, underscoring its central role in the global artificial intelligence supply chain as demand for advanced chips continues to intensify.

The world’s largest contract chipmaker reported a sharp rise in quarterly profit, surpassing market expectations and extending a streak of year-over-year earnings growth. Strong orders for high-end processors used in artificial intelligence and data centers were the primary drivers behind the performance.

Earnings Beat and Revenue Milestone

During the fourth quarter, TSMC recorded revenue exceeding NT$1 trillion for the first time, reflecting solid growth from a year earlier. Net profit climbed significantly, outpacing analyst forecasts and marking the company’s eighth consecutive quarter of annual profit growth.

Management also issued an upbeat outlook, projecting further revenue expansion in the current quarter. At the midpoint of its guidance, sales are expected to post strong year-over-year growth, supported by sustained demand for cutting-edge manufacturing technologies.

AI and High-Performance Computing Lead Growth

TSMC’s high-performance computing segment—which includes chips for artificial intelligence and 5G—accounted for more than half of total revenue during the quarter. Smartphone-related chips represented roughly one-third of sales, highlighting a more moderate recovery in consumer electronics compared to the explosive growth seen in AI-related demand.

Advanced manufacturing remains a key strength. Chips produced using 7-nanometer and more advanced processes made up more than three-quarters of wafer revenue, reflecting the industry’s shift toward smaller, more efficient designs that enable faster processing and lower power consumption.

Focus on Next-Generation Technology

The company is accelerating the rollout of its next-generation 2-nanometer technology, following the start of mass production late last year. To support this expansion, TSMC plans a substantial increase in capital spending over the coming year, signaling confidence in long-term demand for advanced semiconductors.

While AI-driven growth remains robust, industry observers note that demand tied to consumer electronics such as smartphones and personal computers could face near-term pressure from component shortages and rising prices. Even so, expectations remain high that artificial intelligence and server-related applications will continue to anchor TSMC’s performance.

As global technology companies race to scale AI capabilities, TSMC’s dominance in advanced chip manufacturing positions it to remain a critical beneficiary of the ongoing semiconductor transformation.

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