TSMC Reports Robust Q2 Revenue Growth, Driven by AI Demand

Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, announced impressive second-quarter revenue growth on Wednesday, significantly surpassing market expectations due to soaring demand for artificial intelligence (AI) applications.

TSMC, which counts tech giants like Apple and Nvidia among its clients, has thrived amid the AI boom, which has helped offset the decline in pandemic-driven demand. This surge has propelled TSMC’s share price to unprecedented levels.

For the April-June period, TSMC reported revenue of T$673.51 billion ($20.67 billion), according to Reuters calculations. This figure far exceeded the LSEG SmartEstimate from 21 analysts, which predicted T$654.27 billion.

This represents a 32% year-on-year increase, compared to $15.68 billion in the same period last year. It's worth noting that TSMC reports monthly revenue in Taiwan dollars but provides quarterly figures and forecasts in U.S. dollars during its earnings calls.

In its April earnings call, TSMC had forecasted second-quarter revenue to range between $19.6 billion and $20.4 billion.

For June alone, TSMC reported a 33% year-on-year revenue increase to T$207.87 billion. However, the company did not elaborate further in its brief revenue statement.

TSMC, Asia’s most valuable publicly listed company with a market capitalization of $830 billion, will release its detailed second-quarter earnings report on July 18, where it will also update its outlook for the current quarter and the rest of the year.

Analysts expect TSMC to report a 30% year-on-year rise in second-quarter net profit, according to an LSEG SmartEstimate.

TSMC’s shares in Taipei, trading at record highs, closed up 0.5% on Wednesday prior to the sales data release, aligning with the broader market trend. The shares have surged 76% this year, compared to a 34% gain in the broader market.

On Monday, TSMC’s ADRs soared 4.8% to a record $192.79, briefly elevating the company’s market value to $1 trillion.