AI Demand Lifts TSMC to Record Quarterly Earnings
REPORTER:
2026 is already shaping up to be a strong year for TSMC. The company posted record profits at its Q1 earnings call this Thursday, driven by huge demand for its most advanced AI chips.
REPORTER:
TSMC says net profit jumped 58% in the first quarter, beating expectations. It made about $18.2 billion US dollars net from January to March — its highest quarterly profit ever.
REPORTER:
That growth is coming from its most advanced chips — including 3-nanometer technology and packaging used in AI. Analysts say demand is now outpacing supply, with major clients like Nvidia and Apple relying on TSMC. But despite the strong results — some warn the company’s stock may not keep rising.
Tsai Ming-han (FINANCIAL ANALYST):
Further growth potential is very limited and the stock price could easily experience a pullback. TSMC's earnings calls are always very impressive but they’re just one-offs. Usually, for about a week after an earnings call the stock price generally remains in consolidation mode.
REPORTER:
So even as earnings surge — short-term momentum could slow. Still, TSMC’s rally has helped lift Taiwan’s broader market. Taiwan’s total market capitalization has now topped $4 trillion US dollars, overtaking the UK to become the world’s 7th largest.
REPORTER:
At the same time, the company is ramping up spending overseas — raising concerns about rising costs. It plans to invest up to $30 billion US dollars this year into its global operations, part of a wider $165 billion US dollar effort to build up chip production in the United States.
Chai Huan-hsin (DEPUTY DIRECTOR, CLOUDEXPRESS EDGE LAB):
This year, many semiconductor materials and [industrial] gases have seen significant price increases. The Arizona plant is also continuing to expand its production scale which will put a financial burden on TSMC. I think everyone is concerned about whether TSMC's foundry prices will be adjusted upward this year.
REPORTER:
That raises questions about margins and profits going forward.
REPORTER:
So, while demand for AI chips remains strong, rising costs and global expansion efforts will be key considerations to watch this year.
