TSMC posts record profit and lifts its 2026 outlook as AI chip demand surges
First-quarter net income climbed 58% to $18 billion, marking 8 straight quarters of double-digit growth
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A record T$572.5 billion ($18.2 billion) in first-quarter net income — a 58% jump year over year — prompted Taiwan Semiconductor Manufacturing Co. to lift its full-year revenue outlook on Thursday and commit to higher capital spending.
The revised annual revenue outlook calls for growth exceeding 30% in dollar terms, a step up from the previous projection of roughly 30%. On the spending side, TSMC $TSM said capex would come in toward the top of its $52 billion to $56 billion guidance range.
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Second-quarter sales are expected to land between $39 billion and $40.2 billion, against $30.1 billion recorded in that period twelve months prior.
At T$22.08, earnings per share beat the analyst consensus estimate of T$20.88, according to MarketWatch, extending to eight quarters the company's unbroken streak of double-digit profit growth.
On the earnings call, Wei characterized AI chip demand as "extremely robust" and expressed enduring confidence in what he termed "the multi-year AI megatrend." Separately, he flagged the Middle East conflict as a source of macroeconomic uncertainty that was shaping the company's near-term planning.
Chips built on the 3-nanometer node — the workhorses of AI computing — have grown to represent a quarter of TSMC's total revenue, a dramatic rise from just 6% in the third quarter of 2023. To keep pace with demand, which Wei described as straining available capacity, the chipmaker is scaling up 3-nm wafer output at sites in Taiwan, the U.S., and Japan, targeting expanded mass production volumes in 2027 and 2028.
The Arizona buildout, into which TSMC has committed $165 billion, anchors the company's U.S. manufacturing push. Wei cautioned that constructing a new fab is a two-to-three-year endeavor and that the chipmaking business offers "no shortcuts."
Shares of TSMC are up roughly 35% in 2026, lifting the company's market capitalization to approximately $1.7 trillion — close to twice the valuation of Samsung Electronics, its South Korean peer, according to Reuters.