TSMC posts 77 percent profit jump for Q2, surging past market expectations

TSMC, the world's main producer of advanced AI chips and a major supplier to Nvidia on Thursday posted a 77 percent jump in second-quarter profit to a record that was far ahead of market forecasts.

Benefiting from surging demand for advanced chips used in artificial intelligence applications, Taiwan Semiconductor Manufacturing Co said net profit for April to June climbed to T$706.6 billion (US$21.99 billion), its ninth straight quarter of double-digit percentage growth.

That was well ahead of a forecast T$632.6 billion for the second quarter, according to an LSEG SmartEstimate compiled from 18 analysts. SmartEstimates place greater weight on forecasts from analysts who are more consistently accurate.

Analysts said demand for Taiwan Semiconductor Manufacturing Co's 2330.TW 3-nanometre and 2-nanometre process technologies for AI chips, as well as for its advanced chip packaging technology, CoWoS, remains strong.

That has catapulted Asia's most valuable company, a key supplier to Nvidia and Apple to new heights. Its market capitalisation is now nearly double that of South Korean rival Samsung Electronics at around US$1.97 trillion.

On Monday, the company announced a 36 percent rise in second-quarter revenue, ahead of market forecasts and a record high.

The company has scheduled an earnings call for 0600 GMT to give third-quarter and full-year guidance.

Analysts broadly expect TSMC to raise its full-year revenue growth outlook and will be watching whether it also increases capital spending, a key indicator of management's confidence in the durability of AI demand.

On its last earnings call in April, the company said 2026 capital expenditure would be at the high end of its earlier guidance of US$52 billion to US$56 billion.

TSMC is investing US$165 billion to build chip factories in the US state of Arizona.

TSMC's Taipei-listed shares have gained 59 percent so far this year, largely in line with the broader market.

Reuters

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