TAIPEI (Reuters) – Taiwan Semiconductor Manufacturing Co, the dominant producer of advanced chips utilized in artificial intelligence applications, is anticipated to report a 42% leap in third-quarter profit on Thursday because of soaring demand.
The world’s largest contract chipmaker, whose customers include Apple and Nvidia, has benefited from a surge towards AI across a spectrum of industries.
TSMC is about to report a net profit of T$300.1 billion ($9.33 billion) for the quarter ended Sept. 30, in response to an LSEG SmartEstimate drawn from 23 analysts. SmartEstimates give greater weighting to forecasts from analysts who’re more consistently accurate.
That estimate compares to the 2023 third-quarter net profit of T$211 billion.
TSMC last week reported a jump in Taiwan-dollar denominated third-quarter revenue, easily beating market expectations. It is going to give fourth-quarter revenue guidance in U.S. dollars.
Nevertheless, on Tuesday, ASML, the world’s biggest chipmaking equipment supplier to corporations including TSMC, forecast lower than expected 2025 sales and bookings on sustained weakness in parts of the chip market, pushing the Dutch firm’s shares to their biggest one-day drop since 1998.
On Wednesday, TSMC’s shares closed down 2.3% at T$1,045, though not far off their historic high of T$1,080 hit on July 11.
TSMC, at its quarterly earnings call starting at 0600 GMT on Thursday, will update its outlook for the present quarter in addition to for the complete 12 months, including its capital expenditure, because it races to expand production.
The chipmaker is spending billions of dollars constructing recent factories overseas, including $65 billion on three plants within the U.S. state of Arizona, though it has said most manufacturing will remain in Taiwan.
On its last earnings call in July, TSMC raised its full-year revenue forecast and adjusted its capital expenditure plans for this 12 months to between $30 billion and $32 billion, compared with a previous forecast of $28 billion to $32 billion.
The second half of the 12 months is traditionally the height season for Taiwanese tech corporations as they race to produce customers ahead of the year-end holiday season in major Western markets.
The AI boom has helped drive up the value of shares in Asia’s most respected company, with TSMC’s Taipei-listed stock leaping 76% up to now this 12 months, compared with a 28% gain for the broader market.
TSMC, colloquially referred to in Taiwan because the “sacred mountain protecting the country” for its critical role in Taiwan’s export-dependent economy, faces little competition, though each Intel and Samsung are attempting to challenge its dominance.
($1 = 32.1740 Taiwan dollars)
(Reporting by Ben Blanchard; Editing by Christopher Cushing)