Taiwan Semiconductor Manufacturing Co delivered second-quarter results that substantially exceeded analyst expectations, with net income rising 77.4% year over year. The company’s profits reached record highs for a fifth consecutive quarter and climbed 23.4% from the prior quarter. Revenue expanded to NT$1.27 trillion, representing a 36% increase from NT$933.79 billion in the year-ago period.
Chairman C.C. Wei attributed the strong performance to continued robust demand from artificial intelligence-related applications. The company raised its capital expenditure guidance to between $60 billion and $64 billion for the year as it pursues aggressive expansion. Wei announced that TSMC would commit an additional $100 billion toward Arizona operations, bringing cumulative investment in the state to $265 billion. The funds would support construction of multiple semiconductor fabrication plants for two-nanometer mass production technologies and advanced packaging facilities serving major U.S. customers.
The company projected third-quarter revenue between $44.6 billion and $45.8 billion, with operating profit margins anticipated between 56% and 58%. Advanced process technologies at seven nanometers and smaller represented 77% of total wafer revenue. Within that segment, five-nanometer technology accounted for 33% of second-quarter revenue, while three-nanometer processes contributed 30%. High-performance computing applications drove 66% of platform revenue, followed by smartphones at 22% and Internet of Things at 5%.
Analysts noted that TSMC maintained selective pricing discipline rather than pursuing opportunistic margin expansion, allowing the company to capture additional value while preserving customer relationships. Some observed that the memory sector boom was creating headwinds for non-AI businesses, with consumer and price-sensitive markets experiencing pressure from rising memory costs and component supply constraints. The company’s stock gained 1.23% on the earnings announcement and has appreciated over 58% so far this year.
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