Taiwan Semiconductor Manufacturing Company (TSMC) reported a 39.1 per cent year-on-year increase in net profit for the third quarter of 2025, driven by sustained demand for artificial intelligence chips. The company posted net income of NT$452.3 billion, surpassing analyst expectations of NT$417.69 billion, according to LSEG SmartEstimates. Revenue for the quarter rose 30.3 per cent to NT$989.92 billion (USD 33.10 billion), also exceeding the projected NT$977.46 billion.
The company’s high-performance computing (HPC) division, which includes AI and 5G applications, accounted for 57 per cent of total revenue during the July–September period. TSMC manufactures advanced AI processors for clients such as Nvidia and AMD, and has seen increased orders from both AI GPU and premium smartphone platform customers. Advanced chips sized 7 nanometres or smaller contributed 74 per cent of total wafer revenue in the quarter.
TSMC CEO C.C. Wei stated during the earnings call that the company had revised its full-year revenue growth forecast to the mid-30 per cent range, up from the earlier estimate of around 30 per cent. Wei attributed the revision to continued momentum in AI adoption and the resulting demand for compute infrastructure. He noted that the company’s conviction in the AI trend had strengthened due to increased consumer uptake of AI models.
The company also raised its capital expenditure floor for 2025 to USD 40 billion, up from the previously stated USD 38 billion. This includes investments in capacity expansion and technology upgrades. TSMC has been expanding its manufacturing footprint in the United States, a move that could help mitigate the impact of potential US tariffs on semiconductors.
Executives acknowledged ongoing uncertainty around trade policy, particularly in consumer and price-sensitive segments. Wei said the company was monitoring developments as Taiwan negotiates for a lower reciprocal tariff rate with the United States. While some exemptions are expected, the company is preparing for possible disruptions.
According to Counterpoint Research, growth in TSMC’s 3nm and high utilisation of 4nm and 5nm nodes were key contributors to the quarter’s performance. Shares of TSMC have risen more than 38 per cent year-to-date on the Taiwan Stock Exchange. |
