TSMC's sales spike by 26 percent due to increased investment in AI technology
TSMC's Record Growth and Dominance in Global Semiconductor Market
Apple Inc's fastest quarterly revenue growth in over three years, driven by strong demand in China, has been underpinned by a robust performance from Taiwan Semiconductor Manufacturing Co (TSMC). The semiconductor giant reported a 26% growth in sales last month, totaling NT$323.2 billion (US$10.83 billion), according to Bloomberg. This growth is in line with analyst expectations of a 25% increase in TSMC's third-quarter revenue.
TSMC's growth is solidifying its dominance in the global semiconductor market, with its market share projected to rise from 59% in 2023 to 66% in 2025. This dominance is driven by its leadership in advanced process technologies, particularly in 3nm, 5nm, and rapidly expanding 2nm nodes, which together are crucial for AI and high-performance computing applications.
In the AI sector, TSMC benefits significantly from surging demand for AI chips. The company's focus on advanced nodes optimized for AI and mobile computing ensures it will remain a pivotal supplier in these high-growth sectors. TSMC's shares reached a new high on Thursday due to the announcement of new tariffs on chips that will exempt TSMC, as a result of its investment in US production. TSMC is the go-to chipmaker for AI hardware providers Nvidia Corp and Advanced Micro Devices Inc.
The growth is also indicative of accelerating spending on artificial intelligence. In the smartphone sector, TSMC still holds significant business, which is experiencing a gradual recovery this year, according to Sony Group Corp. TSMC's advanced nodes (7nm and below) account for 74% of its wafer revenue as of Q2 2025, reflecting significant production for leading smartphone SoC makers like Apple.
Looking ahead, TSMC's growth is expected to continue driving shifts in global semiconductor supply chains, pricing power, and competitive dynamics due to its technological leadership and expanding manufacturing footprint. The firm's focus on advanced nodes optimized for AI and mobile computing ensures it will remain a pivotal supplier in these high-growth sectors, with new process technologies becoming increasingly important to meet the performance and efficiency demands of future AI workloads and smartphones.
However, TSMC is not without challenges. The stronger New Taiwan dollar is one of the headwinds the company is facing. TSMC and GlobalWafers Co are the most likely Taiwanese chipmakers to benefit from new tariffs on semiconductors, having invested billions in US production facilities.
TSMC's rivals, United Microelectronics Corp and ASE Technology Holding Co, with limited near-shoring efforts, are vulnerable and at risk of losing market share to US-based rivals GlobalFoundries Inc and Amkor Technology Inc.
In summary, TSMC's current impact is substantial market share dominance and record financial performance fueled by AI and smartphone chip demand. Its future outlook is robust as it ramps advanced nodes like 2nm, further locking in leadership in these strategic semiconductor markets.
[1] [2] [3] [4] - Sources for further reading.
- TSMC's dominance in the global semiconductor market is attributed, in part, to its advancements in artificial-intelligence (AI) technologies, particularly in the production of chips optimized for AI and high-performance computing applications.
- TSMC is a significant supplier in the AI sector, with its technological leadership and focus on advanced nodes ensuring its continued presence as a pivotal player in this high-growth industry.
