Record Profits, Elevated Spending
TSMC’s net income for the April-to-June quarter surged 77.4% year-over-year to a record T$706.6 billion ($22 billion), far exceeding Bloomberg consensus estimates of T$623.7 billion. Revenue reached $40.2 billion, at the high end of the company’s guidance and up 36% from a year earlier. Gross margins expanded to 67.7%, beating the top of the company’s projected range. Iinvesting
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The company raised its full-year revenue growth guidance to above 40% and lifted its 2026 capital expenditure forecast to $60 billion to $64 billion, at least $4 billion above its prior projection of $52 billion to $56 billion. The capex increase spooked investors — TSMC shares listed in Taipei fell 7.29% on Friday to close at T$2,290, their steepest single-day drop in months, after the company warned that the rapid ramp-up of its 2-nanometer process could weigh on near-term margins. Ttaiwannews
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$265 Billion Arizona Commitment
Chairman and CEO C.C. Wei announced during the earnings conference that TSMC would invest an additional $100 billion in the US, funding at least four new fabrication plants producing chips at the 2-nanometer node and below, along with advanced packaging facilities. The new fabs will be built on a 900-acre site the company acquired earlier this year, according to The New York Times. 112news
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The Trump administration confirmed the deal, which brings TSMC’s total announced US investment to $265 billion — described as the largest foreign direct investment in American history. The commitment builds on $165 billion previously pledged under agreements that began during the Biden administration. Kktar
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Demand Outpaces Supply
Wei has repeatedly warned that global chip supply will fall short of AI-fueled demand for years, a message he reiterated at the company’s annual shareholder meeting in June. The view underpins TSMC’s willingness to spend aggressively despite investor unease over elevated capital outlays. Bbloomberg
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The earnings report triggered a broader sell-off in semiconductor stocks across Asian markets on Friday. Nvidia and Apple, two of TSMC’s largest customers, rely heavily on the Taiwanese firm’s advanced manufacturing capabilities — a dynamic that makes TSMC’s capacity expansion plans a bellwether for the AI infrastructure buildout. Bbusinesstimes
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