Taiwan Semiconductor Manufacturing Company (TSMC) is set to report a 34% revenue growth for the third quarter of 2024, fueled by global demand for AI chips and strategic expansions in the U.S. and Europe.
Taiwan Semiconductor Manufacturing Company (TSMC) is projected to report a 34% year-on-year revenue growth for the third quarter of 2024, with revenues expected to reach $23.1 billion, increasing from $17.3 billion in the prior year. Analysts have forecasted adjusted earnings per share (EPS) of $1.80, highlighting TSMC’s strong position within the rapidly expanding artificial intelligence (AI) sector. TSMC plays a crucial role in this growth as a major supplier of AI chips to top tech companies like Nvidia and Apple, which depend heavily on these chips. The company’s revenue guidance for the quarter ranges from $22.4 billion to $23.2 billion, closely matching market expectations.
TSMC’s growth is further supported by its strategic investments in expanding manufacturing capacity beyond Taiwan. The company has committed over $65 billion to develop advanced semiconductor manufacturing plants in Arizona and U.S. This move aims to enhance TSMC’s production capabilities while reducing its dependence on Taiwan, especially in light of global supply chain concerns. Additionally, TSMC is looking at expanding its operations in Europe, signaling its commitment to addressing the increasing global demand for AI chips and reducing exposure to geopolitical risks in Asian markets like China.
Looking forward, TSMC’s financial performance is expected to remain strong, with gross margins forecasted to exceed 54.5%. Analysts anticipate revenue growth exceeding 37% for the quarter, surpassing the company's midpoint projections. Although there are concerns about potential overinvestment in AI infrastructure, TSMC’s leadership in AI chip production remains solid. Strategic partnerships with industry leaders like Nvidia and AMD, along with the expected supply of Nvidia's “Blackwell” chips, continue to strengthen TSMC’s dominant position in the global semiconductor market.
