TSMC also raised its forecast for capital spending by up to 14% for this year
[TAIPEI] TSMC, the world’s main producer of advanced AI chips and a major supplier to Nvidia, pledged on Thursday (Jul 16) to invest a further US$100 billion in the US state of Arizona and said it was still seeing robust AI-driven demand for chips.
Riding the AI boom, TSMC also raised its forecast for capital spending by up to 14 per cent for this year.
The upbeat outlook came after Taiwan Semiconductor Manufacturing Co, a bellwether for AI chip demand, posted a 77 per cent jump in second-quarter profit to a record high of T$706.6 billion (US$22 billion), beating a market forecast of T$632.6 billion and marking its ninth straight quarter of double-digit percentage growth.
Capital expenditure for 2026, a key indicator of management’s confidence in the durability of AI demand, is forecast to be between US$60 billion and US$64 billion, compared with previous guidance of the high end of between US$52 billion and US$56 billion, it said.
Full-year revenue in US dollar terms will increase by slightly more than 40 per cent for 2026, compared with a previous forecast of more than 30 per cent. For the current quarter, TSMC forecast sales between US$44.6 billion and US$45.8 billion, up from US$33.1 billion a year earlier.
Thriving on surging demand for advanced chips used in AI applications, TSMC’s further US$100 billion investment in Arizona would add to already-announced investments of US$165 billion to build chip factories there.
TSMC’s aggressive capital spending and soaring profit margins have made it a barometer of demand in the global semiconductor industry.
Analysts said demand for TSMC’s 3-nanometre and 2-nanometre process technologies for AI chips, as well as for its advanced chip packaging technology, CoWoS, remains strong.
That has catapulted Asia’s most valuable company, also a key supplier to Apple, to new heights. Its market capitalisation is now nearly double that of South Korean rival Samsung Electronics at around US$1.97 trillion.
On Monday, the company announced a 36 per cent rise in second-quarter revenue, ahead of market forecasts and a record high.
In related news, on Wednesday Dutch company ASML, the world’s dominant supplier of equipment needed to make high-tech computer chips, raised its 2026 sales forecasts and pledged a capacity boost that may ease fears a production bottleneck could slow the AI boom.
TSMC’s Taipei-listed shares have gained 59 per cent so far this year, largely in line with the broader market. REUTERS
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