Prime Highlight
- TSMC posted strong fourth-quarter results, driven by sustained global demand for artificial intelligence and high-performance computing chips.
- The company’s growing share of advanced chip production strengthens its central role in the global AI and data centre supply chain.
Key Facts
- TSMC reported Q4 net profit of NT$505.74 billion, up 35% year-on-year, beating market estimates of NT$478.37 billion.
- Quarterly revenue rose 20.5% to NT$1.046 trillion, with 7nm and smaller chips contributing 77% of total wafer revenue.
Background
Taiwan Semiconductor Manufacturing Company (TSMC) on Thursday reported a 35% rise in fourth-quarter profit, beating analyst estimates as strong demand for artificial intelligence chips continued to power growth. The world’s largest contract chipmaker also posted record revenue for the quarter, underlining its key role in the global AI supply chain.
The company reported net income of NT$505.74 billion for the October-December period, compared with market expectations of NT$478.37 billion. Revenue climbed 20.5% from a year earlier to NT$1.046 trillion, crossing the NT$1 trillion mark and beating forecasts of NT$1.034 trillion. TSMC has now delivered year-on-year profit growth for eight consecutive quarters.
TSMC said its advanced chips measuring 7 nanometers or smaller accounted for 77% of total wafer revenue in the quarter. For the full year 2025, these advanced products made up 74% of revenue, up from 69% in 2024. Smaller chip sizes allow faster performance and better energy efficiency, making them ideal for AI servers and data centres.
The company, Asia’s most valuable technology firm by market value, supplies high-end processors to global giants such as Nvidia and AMD. Its high-performance computing division, which covers AI and 5G applications, generated the bulk of its quarterly sales.
Analysts remain positive about the company’s outlook. Counterpoint Research senior analyst Jake Lai said demand for AI continues to drive chip orders across the server industry and expects 2026 to be another strong year for AI servers. He added that TSMC’s 2-nanometer expansion and advanced packaging facilities should support growth.
However, Lai warned that memory shortages and rising prices could reduce demand for consumer electronics like smartphones and PCs, which may weigh on some segments of the chip market.
