By Wen-Yee Lee and Ben Blanchard
Taipei ― Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest manufacturer of advanced AI chips, will likely notch up a fourth consecutive quarter of record earnings with a 50% surge in net profit for January-March thanks to booming demand for AI infrastructure.
Analysts said that demand for TSMC’s 3-nanometre technology to produce AI chips and its advanced packaging technology continues to outstrip the firm’s production capacity.
That has driven Asia’s most valuable company, a supplier to Nvidia and Apple, to new heights. Its market capitalisation is now nearly double that of South Korean rival Samsung Electronics at around $1.6-trillion.
Earnings call
On Thursday, TSMC is expected to report a net profit of T$542.6bn ($17.1bn) for the quarter, according to an LSEG SmartEstimate compiled from 19 analysts. SmartEstimates place greater weight on forecasts from analysts who are more consistently accurate.
An earnings call at which it will provide second-quarter and updated full-year guidance is scheduled for 6am GMT.
Any profit result above T$505.7bn would mark the company’s highest quarterly net income and its ninth consecutive quarter of profit growth.
Last week, it posted a 35% year-on-year rise in first-quarter revenue, ahead of market forecasts.
Looking ahead, “we expect higher quarter-on-quarter revenue growth guidance for the second quarter of 2026, driven by sustained AI demand and advanced-node leadership,” Arthur Lai, head of technology research for Asia at Macquarie Capital, said in a note to clients.
’Short-term disruptions’
The war in the Middle East threatens to disrupt the supply of production materials for semiconductors such as helium and neon, but TSMC is seen as well-placed to weather the crisis.
“TSMC’s diversified sourcing and safety stock should be sufficient to manage short-term disruptions,” said Galen Zeng, senior research manager at IDC.
One area of focus will be whether TSMC maintains or raises its 2026 capital spending plans as that will reflect management’s confidence in long-term AI demand, Zeng said.
TSMC is investing $165bn to build chip factories in the US state of Arizona.
The company has also revised its plans in Japan and is now set to manufacture 3-nanometre chips there, instead of focusing on more mature nodes.
TSMC’s Taipei-listed shares have gained 28% so far this year, outperforming the 22% rise for the broader market.
