TSMC Increases 2026 Capital Expenditure to $56 Billion Amid Strong AI Demand
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1d ago
0mins
Source: NASDAQ.COM
- Increased Capital Expenditure: TSMC expects its capital expenditures for 2026 to reach between $52 billion and $56 billion, a significant rise from $40 billion in 2025, reflecting increased confidence in AI demand and aiming to capitalize on rapidly growing market opportunities.
- Strong Revenue Growth: TSMC reported a 20.5% year-over-year revenue increase and a 35% net income rise in Q4 2025, with expectations of nearly 30% revenue growth in 2026, indicating sustained strong demand for AI-related products.
- AI Accelerator Demand: TSMC anticipates AI accelerator revenue to grow at least 50% annually through 2029, highlighting that investments in AI will drive future revenue growth, despite ongoing concerns about an AI bubble.
- Production Capacity Expansion: TSMC is accelerating the start of production at its second fab in Arizona to the second half of 2027 to meet rising demand, while also acquiring additional land for future expansion, demonstrating a proactive stance on market prospects.
Analyst Views on TSM
Wall Street analysts forecast TSM stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for TSM is 313.46 USD with a low forecast of 63.24 USD and a high forecast of 390.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Analyst Rating
7 Buy
1 Hold
0 Sell
Strong Buy
Current: 341.640
Low
63.24
Averages
313.46
High
390.00
Current: 341.640
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.
