Taiwan Semiconductor Manufacturing Co (ADR) (NYSE:TSM) reported better-than-expected first-quarter results, driven by strong demand for artificial intelligence (AI) chips.
Net income rose 60% year-on-year to $11.3 billion, while revenue climbed 41.6% to $26.2 billion.
High-performance computing, including AI and 5G applications, made up 59% of sales. Advanced chip technologies (7-nanometres and below) contributed 73% of wafer revenue.
TSMC’s CEO, C.C. Wei, said AI-related demand helped offset seasonal weakness in smartphone orders, and that growth in 3nm and 5nm chips would support second-quarter performance. The company maintained its full-year revenue growth forecast of close to the mid-20% range.
However, TSMC faces rising geopolitical risks.
The US has imposed a 10% tariff on Taiwanese goods, which could rise to 32% later this year.
Export controls on clients like Nvidia and AMD may also tighten. In response, TSMC is expanding in the US, with $100 billion committed on top of an existing $65 billion investment.