TSMC shares surged 4.44% after record-breaking Q4 results underscore sustained AI chip demand

TSMC shares surged 4.44% in pre-market trading on January 16, 2026, following the release of record-breaking fourth-quarter results that underscored sustained demand for AI chips.

The foundry reported a profit of NT$505 billion ($16 billion) and revenue exceeding NT$1 trillion ($33.1 billion), both surpassing Wall Street estimates. The figures, coupled with a 25% increase in 2026 capital spending plans, signaled robust confidence in the AI-driven growth cycle. Investors interpreted the data as validation of the sector’s momentum, with TSMC’s High-Performance Computing segment now accounting for 58% of total sales.

Analysts highlighted the report’s role in calming concerns about the sustainability of the AI boom. TSMC’s aggressive $56 billion CapEx budget for 2026 reinforced expectations for continued expansion in advanced chip production, particularly for 2nm technology. The move also bolstered shares of downstream partners like AMD and NVIDIA, whose AI accelerator sales are closely tied to TSMC’s manufacturing capacity.

However, the report underscored a growing divide in the tech sector, with firms demonstrating clear AI monetization outperforming peers. While TSMC’s results solidified its position as the backbone of the AI infrastructure, challenges such as geopolitical manufacturing shifts and rising production costs remain critical risks for the industry in 2026.