TSMC Stocks Surge 3.86% as AI Chip Demand Fuels Profit Boom

On January 16th, TSMC (TSM), a leader in the global semiconductor industry, continued to capture market attention with a strong 3.86% increase, marking a three-day consecutive rise of 6.67%. This enthusiasm among investors is backed by the latest impressive quarterly financial results of the company.

According to TSMC's latest financial report, the company saw a notable 57% year-on-year increase in net profit for the fourth quarter, with revenues reaching NT$868.4 billion. The booming demand for AI chips has been a significant growth driver, enhancing the profitability of TSMC's 3nm process technology, which now accounts for 26% of its profits. Furthermore, high-performance computing (HPC) contributed 53% to the revenue, growing by 58% compared to the previous year. TSMC projects its revenues to increase by 24-26% in 2025, aiming for a 20% compound annual growth rate over the next five years. AI chips and advanced manufacturing processes are evidently emerging as new growth engines for TSMC.

Underpinning this growth is TSMC's robust expansion plan. The company has announced its intention to ramp up its 3nm and 2nm capacity in Taiwan to meet surging market demand. These strategic moves highlight TSMC's significant influence on the global market and its central role in the technology supply chain.

Looking ahead, TSMC plans to increase its capital expenditure to between $38 billion and $42 billion, surpassing market expectations. Additionally, the company is set to expand its footprint overseas, with business ventures in the U.S., Japan, and Europe. Such endeavors are expected to further strengthen TSMC's leadership position in the global semiconductor market.

Overall, TSMC not only demonstrates strong growth potential amidst current market conditions but also indicates a future centered around AI technology and advanced manufacturing processes. For investors, staying attuned to TSMC’s developments and its pivotal role in the global semiconductor industry will be key to reaping future rewards. As the company navigates this opportune period, investors are advised to maintain a sharp focus on industry trends to capitalize on the expanding market opportunities.