TSMC reports better-than-expected sales on sustained AI demand

Taiwan Semiconductor Manufacturing Co. reported a 30% increase in its third-quarter sales as major US tech companies continued to make multibillion-dollar bets on AI.

Revenue for the three-month period ending in September totalled NT$989.9 billion ($32.5 billion), according to Bloomberg News calculations based on monthly sales numbers provided by the company, while analysts on average were looking for NT$962.8 billion. The shares of Asia’s most valuable company have gained more than 30% this year thanks to the prolonged AI euphoria.

The Taiwanese company is the go-to chipmaker for major AI accelerator designers, including Nvidia Corp., Advanced Micro Devices Inc. and Broadcom Inc., and it also makes processors for iPhones and other Apple Inc. devices. The consumer electronics market has registered little growth in recent times, but TSMC’s shift to more advanced manufacturing is making each unit sold more profitable.

On the AI front, US tech firms from Nvidia to OpenAI are spending billions of dollars to build up their cloud computing capabilities, which TSMC executives see as a major long-term growth driver. While there have been some concerns that recent “circular” deals made by those companies are creating a gigantic bubble, TSMC’s latest sales numbers suggest AI demand for now remains intact.

The Taiwanese company is set to release its full third-quarter results on Oct. 16.

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