TSMC – Disciplined Growth

Hello everyone, wishing you all the best for the year ahead.

We started the year with results from Taiwan Semiconductor Manufacturing Company, better known as TSMC, a business that quietly powers much of the modern world. Its chips are found in everything from phones to the advanced servers that train and run generative AI models. As AI adoption accelerates, TSMC’s performance has become a useful indicator of where the broader tech industry is heading.

For the recent quarter, TSMC reported revenue of NT$1.05 trillion, or around US$33.7 billion, up 20.5% from a year earlier. Operating margins reached 54%, an impressive five -percentage-point increase from the same quarter last year.

The High-Performance Computing (HPC) division, which includes chips used for AI workloads and data centres, was the standout performer. Yearly revenue grew 48% year over year and made up 58% of the company’s revenue. Meanwhile, the smartphone segment grew 11% and contributed 29% of total revenue. Together, these two segments accounted for 87% of TSMC’s sales, underscoring how central AI and premium devices have become to its success.

A few factors helped drive the strong results. Demand for cutting -edge chips remains extremely high, and TSMC continues to lead the industry in advanced manufacturing technologies. Its newest and most efficient chip processes generated most of the wafer revenue. High utilisation across its facilities supported higher profitability, while cost -improvement efforts and favourable currency movements added another lift to margins.

Alongside its financial performance, TSMC is making steady progress on its global capacity expansion. The company has continued to advance construction and ramp -up efforts across its international manufacturing sites, including its major projects in the United States. While there is still work ahead, TSMC remains confident that these new facilities will support long–term growth and strengthen the resilience of global semiconductor supply chains.

Despite its market leadership, TSMC maintains a disciplined approach to pricing. It is not raising prices simply because demand is high; rather, the higher pricing on new technologies mainly offsets inflation and the rising complexity of manufacturing. Profitability continues to be driven by operational excellence, high utilisation, and productivity gains rather than opportunistic pricing.

Overall, TSMC starts the year from a position of real strength. Accelerating demand for AI-related chips, combined with solid smartphone sales and industry-leading manufacturing capabilities, continues to push the company forward. With expansion progressing well and technology leadership firmly intact, TSMC remains one of the foundational companies shaping the future of global technology.