Taiwan Semiconductor Anticipates Revenue Surge Amid AI Demand

Key Points

• TSMC reported a significant 12.9% increase in revenue in Q1, with expectations of a 20% revenue increase for the year.
• Advanced technologies and AI demand drive growth, with plans to start mass production of 2nm chips by late 2025.
• Despite a decrease in revenue from China, North America remains the dominant market, contributing 69% of total net revenue.

In this news

Taiwan Semiconductor Manufacturing Co. (TSMC) has recently announced its first-quarter results, showcasing a robust performance with a 12.9% year-over-year increase in revenue, totaling $18.87 billion. This figure surpasses the market estimates, with earnings per ADR reaching $1.38. Despite a slight 3.8% revenue decline from the previous quarter, the company's net income saw an 8.9% increase year-over-year, amounting to NT$225.49 billion.

Looking ahead, TSMC has set an optimistic revenue forecast for the second quarter, expecting figures between $19.6 billion and $20.4 billion. This projection is underpinned by the burgeoning demand for AI technologies, where TSMC's advanced technologies (7nm and below) play a pivotal role, accounting for 65% of total wafer revenue. Notably, their 3nm process technology contributed to 9% of the total wafer revenue in Q1. The company also plans to initiate mass production of 2nm chips by late 2025, further solidifying its technological leadership.

Geographically, North America continues to be TSMC's largest market, contributing 69% to the total net revenue. However, revenue from China has seen a decline, dropping to 9% from 15% a year ago. Despite the downturn in the automotive sector, TSMC maintains its expenditure forecast for capacity expansion and upgrades, aligning with its optimistic revenue and market growth projections for the upcoming years.