TSMC's upcoming fourth-quarter financial report is expected to show a sharp increase in net profit, mainly due to strong growth in demand for artificial intelligence chips. However, uncertainty from U.S. policy also poses challenges. This financial report will provide important information about TSMC’s development in the AI era, as well as the company’s latest outlook on future capital expenditures and global production capacity planning. Let’s take an in-depth analysis of TSMC’s financial performance, challenges it faces, and its future direction.
TSMC is expected to release its fourth-quarter financial report on Thursday, showing that its net profit will increase 58% from the same period last year, mainly due to the surge in demand for artificial intelligence (AI) chips. As the world's largest wafer foundry, TSMC has benefited greatly from the AI boom. However, technology restrictions from the United States and uncertainty about potential import tariffs from the new Trump administration have also brought considerable challenges to it. .
According to analysis by 22 analysts, TSMC's net profit in the fourth quarter of 2023 is expected to reach NT$377.95 billion (approximately US$11.41 billion), compared with NT$238.7 billion in the same period last year. TSMC reported quarterly revenue data last week that far beat market expectations and plans to hold a meeting later this week to provide revenue forecasts in U.S. dollars.
For TSMC, a good relationship with the Trump administration is crucial. Brett Simpson, co-founder and senior analyst at Arete Research, said that 2025 is expected to be an important year for AI customers to drive TSMC's continued growth. He is confident that TSMC can establish a good relationship with the new government.
It is worth noting that TSMC is investing and building factories around the world, including investing US$65 billion to build three new factories in Arizona, the United States. However, most production activities will remain at the original location. TSMC plans to update its current quarter and full-year outlook, including capital expenditure plans, in its upcoming financial report. In a report last October, TSMC said capital expenditures in 2025 were expected to be higher than in 2024, although it did not disclose specific figures. The company had previously forecast capital investment in 2024 to exceed $30 billion.
The AI craze has driven TSMC's stock price soaring. Its shares on the Taipei Stock Exchange rose 81% last year, while the broader market rose only 28.5% during the same period. For investors and the market, TSMC's performance is undoubtedly a positive signal, showing its dominant position in the global semiconductor market.
TSMC’s future development deserves attention. Its continued investment in the AI field and global layout will determine its position in future competition. This financial report release will provide the market with a clearer vision, let us wait and see.