TAIPEI — Taiwan Semiconductor Manufacturing Co. delivered the biggest quarter in its history on Thursday, reporting net profit of NT$763.1 billion (about US$23.6 billion) for the three months through September — up nearly 69 percent from a year earlier and its sixth consecutive quarterly profit record.
The result easily beat the analyst consensus, which had settled around NT$740–746 billion, and extends an earnings streak that has made TSMC the central bellwether of the artificial-intelligence trade. Quarterly revenue rose 50.9 percent to NT$1.49 trillion, roughly US$46.7 billion.
Key Takeaways
- TSMC’s Q3 net profit rose about 69% to NT$763.1 billion — a record and the sixth straight record quarter.
- Revenue climbed 50.9% to NT$1.49 trillion; earnings per share reached NT$29.43.
- The 2nm process now generates 8% of wafer revenue, up from 3% last quarter.
- Analysts say booming AI demand is the engine — but warn investors are starting to expect perfection.
Margins stay rich
Profitability barely budged despite the scale of expansion. Gross margin held at 66.4 percent, operating margin at 58.7 percent and net margin at 51.1 percent. Earnings per share climbed to NT$29.43, up 68.7 percent from the same quarter last year. The figures confirm that TSMC continues to command premium pricing for its most advanced manufacturing technology — and that customers are still willing to pay.
2nm ramp gathers pace
The company’s newest process technology is ramping faster than expected. TSMC said its 2-nanometer process accounted for 8 percent of wafer revenue in the quarter, up from 3 percent in the second quarter. The 3nm generation led with 33 percent, followed by 5nm at 28 percent and 7nm at 10 percent. Together, technologies at 7nm and below now make up 79 percent of total wafer revenue — the clearest signal yet of where the semiconductor industry’s money is going.
The AI engine behind the numbers
The driver, as ever, is artificial intelligence. TSMC manufactures the most advanced processors for Nvidia, Apple, AMD and Broadcom — putting it, in the words of one market analyst, “at the very centre of the AI ecosystem.” The company said its business “was supported by strong demand for our leading-edge process technologies,” as governments and tech giants pour money into data centers built to train and run AI tools — from frontier AI models to the autonomous AI agents now reshaping how software gets work done.
Caution flags beneath the celebration
Beneath the celebration, there are warning lights. Analysts say companies posting bumper results in the AI boom risk being “judged against perfection” by investors, and TSMC’s shares — up nearly 60 percent this year — have already pulled back from an early-October record as the wider semiconductor trade wobbled. Questions about stretched valuations, and about when the trillions being poured into AI infrastructure will start paying off, are only getting louder.
America looms large
TSMC is also betting heavily on the United States, with chip plants in Arizona and a planned American investment program worth about US$265 billion. How quickly those overseas fabs come online — and how much they cost — will shape the next chapters of the company’s earnings story, alongside its fourth-quarter guidance and capital spending plans.
For now, though, the message from Thursday’s numbers is simple: the AI chip boom is still very much alive, and the company that makes the world’s most advanced chips is the one cashing in most.
Sources: Reuters; CNBC; The Straits Times; TrendForce.
