Taiwan Semiconductor Manufacturing Co. announced third-quarter results that surpassed analyst expectations, driven by sustained worldwide demand for artificial intelligence-related semiconductors. The company achieved a record net profit representing a 68.7% increase compared to the same period a year earlier, marking its sixth consecutive quarter of record profitability.
The chipmaker’s operating margin reached 58.7% for the quarter, exceeding the upper end of its guidance range of 58%, demonstrating the competitive advantages the company maintains amid elevated demand for advanced chip technologies. TSMC guided fourth-quarter revenue to a range of $52.3 billion to $54.3 billion, representing a 14% sequential increase and a 58% increase year-over-year at the midpoint of the guidance range. The company indicated it would significantly increase capital expenditures from 2026 to 2028 compared to the prior three-year period to address growing customer demand and expand production capacity.
Advanced technologies, comprising 7-nanometer and more advanced chips, represented 79% of total wafer revenue in the quarter, with 3-nanometer nodes accounting for 33% of revenue. High-performance computing applications dominated platform revenue at 68%, followed by smartphones at 21%, while the automotive segment demonstrated the fastest quarterly growth rate at 23%. The company noted that demand for AI accelerators and processors used in agentic AI applications and networking remained robust, with expectations that semiconductors would play an increasingly central role in global AI infrastructure development.
Free cash flow increased substantially to NT$476.56 billion for the quarter from NT$139.38 billion a year prior. TSMC approved an NT$7.00 cash dividend and completed construction of its second Arizona facility, with equipment installation underway and mass production anticipated to commence in the third quarter of 2027. The company indicated it was evaluating potential manufacturing expansions beyond Arizona, including a possible investment in Texas to further strengthen its U.S. manufacturing presence.
Article Attribution | Read More at Article Source
Article summary produced by Claude AI