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Taiwan Semiconductor Manufacturing Company said it was “very comfortable” with demand for AI-related chips as it reported its highest quarterly profit and raised its sales outlook.
TSMC, the world’s biggest maker of chips that power AI, on Thursday reported NT$452.3bn ($14.8bn) in net earnings for the third quarter, a 39 per cent jump year on year, along with a 6 per cent rise in revenues from the previous quarter to NT$989.9bn. It increased its 2025 sales outlook to the mid-30 per cent range.
“AI demand continues to be very strong, stronger than we thought three months ago”, said chair and chief executive CC Wei to investors. “We are still very comfortable that the demand for leading-edge conductors is real.”
Shares in the Taiwanese chipmaker have gained more than 40 per cent in the past 12 months as a result of soaring demand for high-performance semiconductors, as companies race to build infrastructure for artificial intelligence data centres.
TSMC, which supplies companies including Nvidia, AMD, Broadcom and Apple, makes more than 90 per cent of the world’s most advanced chips and has in recent years widened its lead over rivals Samsung and Intel.
The company said the cost of its overseas expansion continued to dilute its gross margin, which was 59.5 per cent.
Still, its gross margin exceeded its high-end guidance for the second quarter owing to a more favourable exchange rate. The chipmaker’s revenues are mainly in dollars and were dented by the appreciation of the Taiwanese dollar earlier this year.
The Taiwanese chipmaker has a large US investment plan in place and is beginning mass production of advanced chips in Arizona this year.
Donald Trump’s administration is determined to reduce America’s dependence on vulnerable overseas tech supply chains. It recently took a 10 per cent stake in struggling chipmaker Intel.
Trump’s tariff policy towards Taiwan is in flux. The administration has levied a 20 per cent tariff rate on goods imported from the island, however, chips are excluded from the levies.
In September, US commerce secretary Howard Lutnick proposed a 50-50 split in chip production between Taiwan and the US, in a suggestion that has been rejected by Taiwan’s vice-premier. The vast majority of chip production is in Taiwan.
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