**TSMC Expected to See 52% Profit Surge Amid AI Demand**
Taipei, Taiwan – Taiwan Semiconductor Manufacturing Company (TSMC), the leading global producer of advanced AI chips, is projected to achieve a remarkable 52% increase in second-quarter profits, reaching unprecedented levels. This surge is attributed to the ongoing boom in artificial intelligence-related demand, although challenges such as U.S. tariffs and a strong Taiwan dollar may impact the company’s outlook.
Analysts predict that while the overall foundry industry revenue is expected to grow by 17% to 18% this year, TSMC’s sales could expand by nearly 30% due to its dominant market position. Mario Morales, group vice president at research firm IDC, highlighted TSMC’s unique advantage as a key supplier to major tech companies like Nvidia and Apple.
According to an LSEG SmartEstimate compiled from 21 analysts, TSMC is anticipated to report a net profit of T$377.4 billion for the quarter ending June 30. This figure, if surpassed, would mark the company’s highest quarterly net income to date and its sixth consecutive quarter of profit growth. TSMC has already indicated a revenue increase of 38.6% for the second quarter.
The impact of U.S. tariffs on TSMC remains uncertain. In April, Taiwan faced the threat of a 32% reciprocal tariff rate, but no updated figures have been communicated. Additionally, President Trump has suggested that tariffs on semiconductors may be implemented soon. TSMC noted in June that these tariffs could indirectly affect its operations by leading to higher prices, which might dampen demand.
Another significant factor is the Taiwan dollar’s 12% appreciation against the U.S. dollar this year. Dan Nystedt, vice president at TriOrient, emphasized that the exchange rate poses a considerable concern, as a substantial portion of TSMC’s revenue is denominated in USD. TSMC has indicated that a 1% appreciation in the Taiwan dollar typically reduces its gross margin by 0.4 percentage points, with the recent appreciation having already impacted its gross margin by over 3 percentage points.
TSMC is set to announce its earnings on Thursday and will provide guidance for the third quarter during an earnings call scheduled for 0600 GMT. Despite a significant 80% surge in shares last year, TSMC’s stock has only risen 3.7% year-to-date, reflecting investor concerns regarding tariffs and unfavorable currency fluctuations.
**FAQ**
**What factors are influencing TSMC’s profit forecast?**
TSMC’s profit forecast is primarily influenced by the booming demand for AI-related products, its leading market position, and potential challenges from U.S. tariffs and currency fluctuations.
