TSMC's Second-Quarter Profit Beats Expectations, Investment Boosted by AI Boom

Taiwan Semiconductor Manufacturing Company (TSMC) reported second-quarter profit that exceeded market expectations. The company revised its 2024 capital expenditure forecast upward due to strong demand in the artificial intelligence (AI) sector. This development indicates that the growth momentum in the global chip industry continues. TSMC's net profit rose 36% year-on-year to NT$247.8 billion (approximately US$7.6 billion), surpassing the average analyst estimate of NT$238.8 billion. The company's revenue increased by 40% to NT$673.5 billion. Demand for AI chips has boosted capacity utilization at TSMC's most advanced 3-nanometer and 5-nanometer production processes. The company raised its capital expenditure for this year from the previous range of US$28-32 billion to US$30-32 billion. This investment will be directed primarily toward new production lines for AI-driven high-performance computing (HPC) chips. TSMC's CEO stated that AI demand will remain strong in the coming years and that the company will continue to expand capacity to maintain its leading position in this field. The company also noted signs of recovery in the automotive and smartphone segments. This is not investment advice.