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TSMC Shares Surge Amid AI Optimism
Shares of Taiwan Semiconductor Manufacturing Co. (TSMC) climbed past NT$1,000 per share, driven by mounting excitement surrounding artificial intelligence (AI) just ahead of its forthcoming earnings report. The recent 2.7% increase saw TSMC closing at a record high in Taipei, marking a substantial 70% rise for the year.
As the globe's premier chip manufacturer, TSMC's impressive market performance is bolstered by robust expectations for its upcoming earnings. Consistent AI demand is a key factor expected to drive TSMC's strong financial results this month. Meanwhile, the market value of TSMC, based on American depositary receipts, has exceeded that of Berkshire Hathaway Inc., securing its place as the eighth-largest company globally and nearing a $1 trillion market cap.
TSMC's advanced technology and valuation have made it a preferred choice for global investors. The company benefits significantly from being Nvidia Corp.'s primary advanced-chip supplier. Projected to report a 36% surge in second-quarter revenue year-over-year, TSMC's revenue growth would be the fastest since the final quarter of 2022, according to a Bloomberg poll of 29 analysts.
Analysts from Bloomberg Intelligence predict TSMC's revenue may surpass market expectations by 10%, potentially leading to a series of earnings surprises within Taiwan's foundry sector. UBS has recently adjusted its full-year capital expenditure forecasts for TSMC, pointing to surging demand related to generative AI and recovering profit margins driven by cutting-edge technology. Additionally, Apple Inc.'s possible use of TSMC's chip-stacking products has further fueled positive market sentiment.
