TSMC, the world’s largest manufacturer of advanced AI chips, will likely report a sixth consecutive quarter of record earnings, driven by booming infrastructure spending in the tech sector.
Alright, folks, gather ‘round because we need to talk about TSMC—no, not your cousin who keeps trying to sell you herbal remedies, but the Taiwan Semiconductor Manufacturing Company. They’re on a bit of a winning streak, and by ‘a bit’ I mean they’re about to report their sixth consecutive quarter of record profits. Yes, you heard me right. Six. Consecutive. Quarters. That’s like winning the lottery six times in a row, except instead of cash, they’re raking in billions from the booming AI sector.
As the world’s largest manufacturer of AI chips, TSMC is basically the tech equivalent of a rock star right now. They’re not just making chips; they’re making the chips that power everything from your fancy new iPhone to the latest gaming consoles. They’ve got a knack for advanced chip packaging technology—specifically, something called CoWoS, which sounds like a trendy coffee shop but is actually a game changer in the chip world.
So, what’s the secret sauce behind their success? According to analysts (who are basically the fortune tellers of the finance world, but with less crystal balls), TSMC’s AI chipmaking capacity is in high demand. Their market capitalization is nearly double that of Samsung Electronics, sitting pretty at around $2.1 trillion. At this rate, they might just need to expand their office to fit all that cash.
On Thursday, TSMC is expected to announce a staggering 65% surge in their third-quarter net profit, hitting T$746.3 billion (that’s about $23.4 billion for us non-Taiwanese currency folks). This is all part of a trend where they’re not just making money; they’re making more money than they ever have before. If they surpass T$706.56 billion in net income, it will mark their highest quarterly net income ever. And yes, it’s not just about the money—they’re also on a winning streak of 11 consecutive quarters of profit growth.
But wait, there’s more! In a recent report, Morgan Stanley’s very own Charlie Chan (not to be confused with the famous detective) predicted that TSMC might even bump up their full-year revenue growth forecast to the low-to-mid 40% range. Why? Because everyone and their grandmother seems to want TSMC’s 3-nanometre chips. Seriously, if you’re not using a 3-nanometre chip these days, are you even trying?
Now, let’s talk about expansion. TSMC is investing a whopping $265 billion to build chip factories in Arizona. They’ve even announced an additional $100 billion investment, because apparently, the only thing better than one billion is two billion. They’re also contemplating a potential investment in Texas, which has analysts scratching their heads. Some think it’s a brilliant move, while others are like, “Hold on, aren’t we still building the factories in Arizona?”
Phelix Lee, a senior equity analyst at Morningstar, expressed some skepticism about the urgency to expand into Texas, pointing out that TSMC’s planned fabs in Arizona haven’t even been built yet. It’s like planning a road trip to Texas when you haven’t even packed your bags. But hey, a little planning never hurt anyone, right?
On top of all this, TSMC raised their capital expenditure forecast for this year to between $60 billion and $64 billion. Their stocks have surged 63% this year, which is pretty much in line with the broader market’s rise of 69%. So, if you were thinking about investing in TSMC, now might be the time to get in on the action—unless, of course, you prefer to watch from the sidelines while they count their money.
In conclusion, TSMC is riding the AI boom like a surfer on a massive wave, and if they keep this up, they might just become the poster child for how to succeed in the tech industry. As they prepare to announce their latest earnings, we can only sit back, grab some popcorn, and enjoy the show. Who knows? Maybe they’ll throw in a few surprise announcements that will leave us all scratching our heads in confusion. But for now, let’s just celebrate their success and hope they don’t forget their humble beginnings—like that cousin we mentioned earlier.
Inspired by: “TSMC expects record profit for sixth consecutive quarter amid AI boom” (r/Crypto)