Taiwan Semiconductor: The Giant of the Semiconductor Industry
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 45 minutes ago
0mins
Should l Buy TSM?
Source: Fool
- Market Share Dominance: Taiwan Semiconductor controls 72% of the global pure foundry chip market, significantly outpacing its nearest competitor, Samsung, at 7%, which solidifies its leadership position in the AI hardware sector and further strengthens its market dominance.
- Strong Financial Performance: In 2025, Taiwan Semiconductor generated over $122 billion in revenue with a net profit margin of 44.5%, and its debt-to-equity ratio stands at a mere 0.2, showcasing its financial robustness in a capital-intensive industry.
- Quarterly Earnings Growth: In Q1 2026, Taiwan Semiconductor reported net revenue of $35.9 billion, a 40.6% increase year-over-year, with earnings per share (EPS) surging 58.3% and net profit margin rising to 50.5%, indicating a continued enhancement in profitability.
- Future Growth Outlook: Taiwan Semiconductor targets an operating margin of 56.5% to 58.5% for Q2 2026, with projected total revenue between $39 billion and $40.2 billion, and aims for a 30% revenue growth over 2025, reflecting strong growth potential.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy TSM?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on TSM
Wall Street analysts forecast TSM stock price to fall
8 Analyst Rating
7 Buy
1 Hold
0 Sell
Strong Buy
Current: 414.150
Low
63.24
Averages
313.46
High
390.00
Current: 414.150
Low
63.24
Averages
313.46
High
390.00
About TSM
Taiwan Semiconductor Manufacturing Co Ltd is a Taiwan-based integrated circuit foundry service provider. The Company is primarily engaged in integrated circuit manufacturing services. It offers advanced process technologies, specialised process solutions, advanced photomask and silicon stacking, and packaging-related technologies, while supporting a comprehensive design ecosystem. The Company's products serve diverse electronic sectors including artificial intelligence, high-performance computing, wired and wireless communications, automotive and industrial equipment, personal computing, information applications, consumer electronics, smart internet of things, and wearable devices.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Taiwan Semiconductor: The Giant of the Semiconductor Industry
- Market Share Dominance: Taiwan Semiconductor controls 72% of the global pure foundry chip market, significantly outpacing its nearest competitor, Samsung, at 7%, which solidifies its leadership position in the AI hardware sector and further strengthens its market dominance.
- Strong Financial Performance: In 2025, Taiwan Semiconductor generated over $122 billion in revenue with a net profit margin of 44.5%, and its debt-to-equity ratio stands at a mere 0.2, showcasing its financial robustness in a capital-intensive industry.
- Quarterly Earnings Growth: In Q1 2026, Taiwan Semiconductor reported net revenue of $35.9 billion, a 40.6% increase year-over-year, with earnings per share (EPS) surging 58.3% and net profit margin rising to 50.5%, indicating a continued enhancement in profitability.
- Future Growth Outlook: Taiwan Semiconductor targets an operating margin of 56.5% to 58.5% for Q2 2026, with projected total revenue between $39 billion and $40.2 billion, and aims for a 30% revenue growth over 2025, reflecting strong growth potential.
See More
Taiwan Semiconductor Holds 72% Market Share with Continued Growth
- Market Dominance: Taiwan Semiconductor commands a 72% share of the pure foundry market, significantly outpacing its nearest competitor, Samsung, at 7%, which solidifies its critical role in global semiconductor production and ensures ongoing demand in the AI hardware sector.
- Strong Profitability: The company is projected to generate over $122 billion in revenue for 2025, with a net profit margin of 44.5%, demonstrating robust profitability in a capital-intensive industry, thereby reinforcing investor confidence.
- Impressive Quarterly Performance: In Q1 2026, Taiwan Semiconductor reported net revenue of $35.9 billion, a 40.6% increase year-over-year, with earnings per share (EPS) soaring by 58.3% and net profit margin rising to 50.5%, indicating strong business momentum.
- Optimistic Future Outlook: The company targets a 30% revenue growth for 2026 compared to 2025, with an operating margin goal of 56.5% to 58.5% for Q2, which is expected to further drive stock price appreciation and attract more investor interest.
See More
Roundhill Memory ETF DRAM Attracts Over $5 Billion in Investments
- Memory Supercycle: The Roundhill Memory ETF (DRAM) attracted over $5 billion in investments within a month, including $1.1 billion on Thursday alone, indicating strong market demand for memory stocks driven by surging AI computing needs.
- Core Holdings Performance: The ETF's core holdings feature leading memory manufacturers like SK Hynix, Micron, and Samsung, allowing investors to gain broad exposure to these high-growth companies, including those not listed on U.S. exchanges.
- Market Reaction: Micron's stock surged over 200 points in a week, climbing from $542 to $747, reflecting optimistic market expectations for memory product demand, with a price-to-earnings ratio of only 9 times projected earnings for the next 12 months, highlighting its appeal as a quality stock.
- Investment Opportunities: Despite waning interest in data center stocks, investors can still capitalize on potential gains in the memory and cooling sectors by purchasing instruments like the DRAM ETF, especially as major tech companies continue to invest heavily in data centers.
See More
Semiconductor Industry Faces Helium Supply Crisis
- Helium Supply Disruption: The Ras Laffan facility in Qatar, one of only two capable of producing semiconductor-grade helium, was impacted by Iranian drone strikes and may not be fully operational for months, posing a significant threat to chip manufacturers who rely on helium for critical processes.
- U.S. Chipmaker Advantage: U.S.-based semiconductor foundries primarily source helium from domestic and Algerian suppliers, and the recent supply chain disruption is expected to accelerate reshoring efforts, thereby strengthening their market position in the global semiconductor landscape.
- Intel's Turnaround: As the largest chip manufacturer in the U.S., Intel has begun high-volume production of its 18A process node at its Ocotillo campus in Arizona, which offers up to 15% better performance per watt and 30% improved chip density, positioning it to regain market share from competitors like TSMC.
- TSMC's Expansion Plans: TSMC has announced an increase in its total U.S. investment to $165 billion to fund new fabs in Arizona, and despite the helium crunch, its diversified supply chain and helium recycling systems provide a competitive edge over many rivals, particularly those in South Korea reliant on Qatari helium.
See More
U.S. Semiconductor Industry Benefits from Helium Crisis
- Helium Supply Crisis: The ongoing helium supply disruption, with Qatar providing a third of the global supply, has been exacerbated by drone strikes on the Ras Laffan facility, which is crucial for semiconductor-grade helium, putting pressure on chipmakers who rely on helium for wafer cooling and photolithography.
- Intel's Market Opportunity: Intel's recent partnerships with Tesla and Google, leveraging its 18A process node's performance advantages, are expected to help regain market share in the semiconductor sector, particularly as U.S. production reshoring accelerates, potentially increasing its market share from below 5%.
- TSMC's Investment Expansion: Taiwan Semiconductor Manufacturing Company (TSMC) plans to invest $165 billion in the U.S. to build three new fabs and an R&D center, and despite facing helium supply challenges, its diversified supply chain and inventory management position it advantageously in the expanding U.S. market.
- Strategic Government Support: The U.S. government's $11.1 billion investment in Intel aims to promote semiconductor production reshoring, reducing reliance on external supply chains, which not only enhances Intel's competitiveness but also lays a foundation for the stable development of the entire industry.
See More
Intel's Stock Soars Nearly 500% Amid AI Boom
- Earnings Beat: Intel's Q1 revenue rose 7% year-over-year to $13.6 billion, exceeding management's midpoint guidance by over $1 billion, demonstrating the company's ability to consistently outperform expectations and boosting market confidence.
- Data Center Growth: The data center and AI segment saw a 22% year-over-year revenue increase to $5.1 billion, sharply accelerating growth, indicating Intel's strengthening role in the AI boom.
- Strategic Partnerships: Intel reached a preliminary agreement with Apple to manufacture some chips, enhancing its credibility in the high-end market, while a $5 billion investment from Nvidia further solidifies its position in custom data center CPUs.
- Valuation Challenges: Despite the stock rising to around $125 with a market cap exceeding $600 billion, Intel's forward P/E ratio stands at 140, necessitating exceptional growth over the next decade to justify this valuation, reflecting high market expectations for its future performance.
See More
Taiwan Semiconductor: The Giant of the Semiconductor Industry
- Market Share Dominance: Taiwan Semiconductor controls 72% of the global pure foundry chip market, significantly outpacing its nearest competitor, Samsung, at 7%, which solidifies its leadership position in the AI hardware sector and further strengthens its market dominance.
- Strong Financial Performance: In 2025, Taiwan Semiconductor generated over $122 billion in revenue with a net profit margin of 44.5%, and its debt-to-equity ratio stands at a mere 0.2, showcasing its financial robustness in a capital-intensive industry.
- Quarterly Earnings Growth: In Q1 2026, Taiwan Semiconductor reported net revenue of $35.9 billion, a 40.6% increase year-over-year, with earnings per share (EPS) surging 58.3% and net profit margin rising to 50.5%, indicating a continued enhancement in profitability.
- Future Growth Outlook: Taiwan Semiconductor targets an operating margin of 56.5% to 58.5% for Q2 2026, with projected total revenue between $39 billion and $40.2 billion, and aims for a 30% revenue growth over 2025, reflecting strong growth potential.
See More
Taiwan Semiconductor Holds 72% Market Share with Continued Growth
- Market Dominance: Taiwan Semiconductor commands a 72% share of the pure foundry market, significantly outpacing its nearest competitor, Samsung, at 7%, which solidifies its critical role in global semiconductor production and ensures ongoing demand in the AI hardware sector.
- Strong Profitability: The company is projected to generate over $122 billion in revenue for 2025, with a net profit margin of 44.5%, demonstrating robust profitability in a capital-intensive industry, thereby reinforcing investor confidence.
- Impressive Quarterly Performance: In Q1 2026, Taiwan Semiconductor reported net revenue of $35.9 billion, a 40.6% increase year-over-year, with earnings per share (EPS) soaring by 58.3% and net profit margin rising to 50.5%, indicating strong business momentum.
- Optimistic Future Outlook: The company targets a 30% revenue growth for 2026 compared to 2025, with an operating margin goal of 56.5% to 58.5% for Q2, which is expected to further drive stock price appreciation and attract more investor interest.
See More
Roundhill Memory ETF DRAM Attracts Over $5 Billion in Investments
- Memory Supercycle: The Roundhill Memory ETF (DRAM) attracted over $5 billion in investments within a month, including $1.1 billion on Thursday alone, indicating strong market demand for memory stocks driven by surging AI computing needs.
- Core Holdings Performance: The ETF's core holdings feature leading memory manufacturers like SK Hynix, Micron, and Samsung, allowing investors to gain broad exposure to these high-growth companies, including those not listed on U.S. exchanges.
- Market Reaction: Micron's stock surged over 200 points in a week, climbing from $542 to $747, reflecting optimistic market expectations for memory product demand, with a price-to-earnings ratio of only 9 times projected earnings for the next 12 months, highlighting its appeal as a quality stock.
- Investment Opportunities: Despite waning interest in data center stocks, investors can still capitalize on potential gains in the memory and cooling sectors by purchasing instruments like the DRAM ETF, especially as major tech companies continue to invest heavily in data centers.
See More
Semiconductor Industry Faces Helium Supply Crisis
- Helium Supply Disruption: The Ras Laffan facility in Qatar, one of only two capable of producing semiconductor-grade helium, was impacted by Iranian drone strikes and may not be fully operational for months, posing a significant threat to chip manufacturers who rely on helium for critical processes.
- U.S. Chipmaker Advantage: U.S.-based semiconductor foundries primarily source helium from domestic and Algerian suppliers, and the recent supply chain disruption is expected to accelerate reshoring efforts, thereby strengthening their market position in the global semiconductor landscape.
- Intel's Turnaround: As the largest chip manufacturer in the U.S., Intel has begun high-volume production of its 18A process node at its Ocotillo campus in Arizona, which offers up to 15% better performance per watt and 30% improved chip density, positioning it to regain market share from competitors like TSMC.
- TSMC's Expansion Plans: TSMC has announced an increase in its total U.S. investment to $165 billion to fund new fabs in Arizona, and despite the helium crunch, its diversified supply chain and helium recycling systems provide a competitive edge over many rivals, particularly those in South Korea reliant on Qatari helium.
See More
U.S. Semiconductor Industry Benefits from Helium Crisis
- Helium Supply Crisis: The ongoing helium supply disruption, with Qatar providing a third of the global supply, has been exacerbated by drone strikes on the Ras Laffan facility, which is crucial for semiconductor-grade helium, putting pressure on chipmakers who rely on helium for wafer cooling and photolithography.
- Intel's Market Opportunity: Intel's recent partnerships with Tesla and Google, leveraging its 18A process node's performance advantages, are expected to help regain market share in the semiconductor sector, particularly as U.S. production reshoring accelerates, potentially increasing its market share from below 5%.
- TSMC's Investment Expansion: Taiwan Semiconductor Manufacturing Company (TSMC) plans to invest $165 billion in the U.S. to build three new fabs and an R&D center, and despite facing helium supply challenges, its diversified supply chain and inventory management position it advantageously in the expanding U.S. market.
- Strategic Government Support: The U.S. government's $11.1 billion investment in Intel aims to promote semiconductor production reshoring, reducing reliance on external supply chains, which not only enhances Intel's competitiveness but also lays a foundation for the stable development of the entire industry.
See More
Intel's Stock Soars Nearly 500% Amid AI Boom
- Earnings Beat: Intel's Q1 revenue rose 7% year-over-year to $13.6 billion, exceeding management's midpoint guidance by over $1 billion, demonstrating the company's ability to consistently outperform expectations and boosting market confidence.
- Data Center Growth: The data center and AI segment saw a 22% year-over-year revenue increase to $5.1 billion, sharply accelerating growth, indicating Intel's strengthening role in the AI boom.
- Strategic Partnerships: Intel reached a preliminary agreement with Apple to manufacture some chips, enhancing its credibility in the high-end market, while a $5 billion investment from Nvidia further solidifies its position in custom data center CPUs.
- Valuation Challenges: Despite the stock rising to around $125 with a market cap exceeding $600 billion, Intel's forward P/E ratio stands at 140, necessitating exceptional growth over the next decade to justify this valuation, reflecting high market expectations for its future performance.
See More
