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TSMC's AI-fueled growth, Alibaba's massive capex bet, and JD.com's mixed results paint a complex picture of Asia's tech landscape
The busiest earnings week for Asian companies is delivering a split-screen moment for investors. On one side: AI demand so strong it’s pushing semiconductor revenues up by double digits. On the other: a Chinese consumer who still isn’t showing up the way bulls were hoping.
TSMC keeps printing money on AI demand #
Taiwan Semiconductor Manufacturing Company reported July 2026 revenue of NT$467.58 billion, roughly $14.5B, representing a 44.7% year-over-year increase. High-performance computing, the category that encompasses AI chip production, accounted for 66% of TSMC’s second-quarter revenue.
JD.com and Alibaba tell two different stories about China #
JD.com released its second-quarter 2026 results on August 13, posting net revenues of RMB 346.4 billion, approximately $51.1B. That’s a 2.9% year-over-year decline, which sounds bad until you learn it beat analyst estimates. Non-GAAP net income climbed 21% to RMB 8.9 billion, suggesting the company is getting leaner even as the top line shrinks.
Alibaba’s fiscal first-quarter 2026 report, released August 20, told a more dramatic story. Net profit cratered 75% to roughly RMB 10.54 billion, about $1.55B. Capital expenditures surged 75% to approximately RMB 67.68 billion, or about $10B. Alibaba’s cloud and compute revenue tied to artificial intelligence jumped 45% in the quarter.
China’s macro picture isn’t helping #
China’s economic data released on August 17 added context that wasn’t particularly encouraging for the consumption recovery narrative. Industrial output growth decelerated to 4.5% year-over-year in July, down from 5.3% in June. Retail sales missed forecasts, reinforcing the sense that Chinese consumers remain cautious.
Tencent is also among the major names reporting during this earnings window, adding another data point to the puzzle of whether China’s tech sector can grow through domestic headwinds or needs to increasingly look offshore and toward AI for its next chapter.
The AI capex question investors can’t ignore #
Alibaba’s 45% jump in AI cloud revenue was not nearly enough to offset the profit impact of its spending spree. The company is investing $10B per quarter in infrastructure while watching overall net income fall by three-quarters.
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