Taiwan’s Taiwan Semiconductor Manufacturing Company reported a 58% increase in first-quarter profit, surpassing estimates and reaching a new record due to strong artificial intelligence chip demand (16/04).

Net income reached NT$572.48 billion for the quarter ending in March, above expectations of NT$543.32 billion, marking a fourth consecutive record quarter.

Revenue rose to NT$1.134 trillion, exceeding forecasts and reflecting a 35% year-on-year increase previously reported.

Strong AI Demand Boosts Revenue and Key Customer Activity

The company continued to see strong demand for advanced semiconductors from major customers, including Apple and Nvidia.

“AI-related demand continues to be extremely robust,” said CEO C.C. Wei, noting that advances in AI are increasing computing needs and driving demand.

TSMC added that customer signals remain strong, supporting expectations of continued AI-driven growth over multiple years.

Advanced Chips Account for Majority of Sales

High-performance computing, including AI and 5G applications, made up 61% of total revenue in the quarter.

Advanced chips, defined as 7-nanometer or smaller, accounted for about 74% of total wafer revenue, while 3-nanometer chips represented 25% of shipments.

Expansion Plans Continue Amid Supply Chain Concerns

TSMC said it is adding an advanced chip fabrication plant in Tainan, Taiwan, as part of its capacity expansion.

The company expects capital spending in 2026 to reach the higher end of its previously projected $52 billion to $56 billion range.

Despite concerns over disruptions linked to the Middle East conflict, executives stated there is no expected near-term impact on operations.

TSMC also said it sources key materials such as helium and hydrogen from multiple suppliers and maintains safety inventory.

Outlook Points to Continued Growth and Tight Supply

TSMC forecasts more than 30% revenue growth for full-year 2026 in U.S. dollar terms.

Second-quarter revenue is expected to reach between $39 billion and $40.2 billion, representing a 10% sequential increase.

According to William Li, demand continues to exceed supply, with no significant signs of slowing.

PHOTO: BLOOMBERG

This article was created with AI assistance.

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