Revenue reached NT$1.27 trillion, while net income climbed 77.4% year over year to NT$706.56 billion, thanks to robust AI demand. The chipmaker also issued strong third-quarter guidance and announced an additional $100 billion investment in Arizona.
TSMC Stock Jumps on Record Q2 Profit
TSMC stock gained on Thursday after the semiconductor manufacturer reported another record-breaking quarter. Second-quarter profit soared well above market expectations on the back of strength in artificial intelligence demand.
The company's shares rose about 1.2% over the trading session to NT$2,470, which extended recent gains. The stock traded as high as NT$2,470 after opening around NT$2,445, likely due to investor optimism following the earnings release.
TSMC stock price (Source: Google Finance)
The world's largest contract chipmaker posted second-quarter revenue of NT$1.27 trillion ($39.45 billion), which beat the LSEG SmartEstimates consensus forecast of NT$1.264 trillion.
Net income reached NT$706.56 billion, which was way ahead of analyst expectations of NT$632.64 billion and was an impressive 77.4% increase compared with the same period last year. Profit also climbed 23.4% from the previous quarter. This extended TSMC's streak of record quarterly earnings to five consecutive quarters.
Strong AI-driven demand is fueling the company's growth. During the earnings call, Chairman C.C. Wei said demand related to artificial intelligence is still "extremely robust," with major customers requiring advanced semiconductor manufacturing capacity. Looking ahead, TSMC forecast third-quarter revenue between $44.6 billion and $45.8 billion while guiding for an operating profit margin of between 56% and 58%
The company also announced plans to invest an additional $100 billion in Arizona. This will increase its total planned investment in the state to $265 billion. Wei said the expansion will fund the construction of several additional semiconductor fabrication plants focused on 2-nanometer mass production technology, along with advanced packaging facilities that are designed to support the growing demand from leading US customers.
TSMC plant in Arizona
Revenue for the quarter climbed 36% year over year from NT$933.79 billion. Advanced manufacturing technologies, including 7-nanometer processes and smaller, accounted for 77% of total wafer revenue during the quarter.
Among TSMC's most advanced manufacturing nodes, 5-nanometer technology contributed 33% of second-quarter revenue, while 3-nanometer chips accounted for another 30%, according to Chief Financial Officer Wendell Huang.
The stronger-than-expected earnings, upbeat guidance, and expanding investment plans is certainly lifting investor confidence, which could be why TSMC stock performed well during Thursday's session.
