TSMC Revenue Climbs 39% in Latest Sign of AI Spending Boom
TSMC’s Q2 revenue jumps 39%, driven by soaring AI chip demand from Nvidia and Apple. Here’s why the boom may just be beginning.
AI isn't cooling off—it’s accelerating.
Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, just posted a 39% year-over-year revenue jump for the June quarter, fueled by surging demand for AI chips. This beat analyst expectations and reinforces growing confidence in a long-term AI infrastructure boom.
TSMC’s Q2 sales reached NT$934 billion ($32 billion), edging past forecasts of NT$928 billion, according to its monthly revenue filings. The company credits its robust performance to strong orders from AI heavyweights like Nvidia and Apple, which continue to invest aggressively in next-gen chip capabilities.
Nvidia Drives the Surge—And a $4 Trillion Milestone
TSMC’s performance mirrors broader investor optimism around AI. This week, Nvidia became the first company in history to cross the $4 trillion market cap mark, cementing its role at the core of AI innovation. TSMC plays an indispensable role in that story, manufacturing the GPUs and processors that power everything from ChatGPT to autonomous systems.
According to Bloomberg Intelligence, TSMC likely reached the upper end of its $29.2 billion guidance for the second quarter, driven by AI chip demand and a rise in outsourcing orders from firms like Intel.
“AI-driven demand is overpowering weakness in mobile and consumer segments,” said analyst Charles Shum, who expects TSMC to maintain its 25% annual growth target in U.S. dollar terms despite macroeconomic concerns.
$100 Billion Bet on the Future of AI
CEO C.C. Wei reaffirmed that demand for AI chips still outstrips supply, prompting TSMC to ramp up investments across its global manufacturing network. The company has pledged an additional $100 billion toward expansion, including new fabs in Arizona, Japan, Germany, and Taiwan.
Wei’s forecast: Mid-20% sales growth in 2025, powered by AI—not smartphones.
That shift marks a strategic pivot for TSMC, which historically relied heavily on Apple and other mobile device makers. While smartphones remain a major revenue source, the AI hardware gold rush is clearly taking precedence.
Risks on the Horizon
Despite the bullish outlook, investors remain cautious. Concerns over global trade tensions—particularly tariffs imposed by the U.S.—could affect the electronics sector and global GDP forecasts. As the Trump administration’s trade stance hardens, supply chains face fresh uncertainty.
TSMC’s operating margins are also under pressure, expected to land near 47%, the lower end of its guidance, due in part to a weakening U.S. dollar.
Still, in a market increasingly defined by AI scale and speed, TSMC appears well-positioned to remain at the epicenter.
Actionable Takeaways:
- Track AI chip demand to gauge semiconductor sector growth.
- Watch TSMC’s global fab expansions in Arizona, Japan, and Germany.
- Monitor U.S.-China trade policies, as they could impact chipmakers globally.
