TSMC raises outlook as AI chip demand surges

Taiwan Semiconductor Manufacturing Company raised its 2026 sales outlook on April 16 after first-quarter profit jumped 58% on demand for artificial intelligence chips. (investor.tsmc.com) (usnews.com) The company reported first-quarter net income of NT$572.48 billion, up from NT$361.56 billion a year earlier, on revenue of NT$1.134 trillion, or $35.90 billion. It told investors full-year revenue in U.S. dollar terms should grow by more than 30%, up from its earlier forecast of about 30%. (investor.tsmc.com) (cnbc.com) (usnews.com) Taiwan Semiconductor Manufacturing Company also said 2026 capital spending will land at the high end of its $52 billion to $56 billion range. For the current quarter, it forecast revenue of $39 billion to $40.2 billion, up from $30.1 billion in the same period last year. (usnews.com) (investor.tsmc.com) The company sits at the center of the artificial intelligence build-out because it manufactures the advanced processors designed by Nvidia and other chip companies. Chief Executive C.C. Wei said demand tied to artificial intelligence remained “extremely robust” and said the company still sees a multi-year trend in higher chip demand. (cnbc.com) (usnews.com) The strongest pull is in the most advanced manufacturing lines, where smaller features let chip designers pack in more computing power. Taiwan Semiconductor Manufacturing Company said 3-nanometer chips made up 25% of first-quarter sales, and advanced chips accounted for about 75% of total wafer revenue. (usnews.com) (cnbc.com) That demand is pushing the company to add capacity in several countries. Wei said production for 3-nanometer wafers is being expanded in Taiwan, the United States and Japan, with larger-volume output planned in 2027 and 2028, while the Arizona project is part of a broader $165 billion investment plan in the state. (usnews.com) The results also answered a near-term question hanging over the sector: whether geopolitical shocks would dent orders or disrupt supply. Wei said the company was planning prudently around risks tied to the Middle East conflict, including supplies of helium and hydrogen, but kept its stronger revenue and spending outlook in place. (usnews.com) (cnbc.com) For now, the signal from Taiwan Semiconductor Manufacturing Company is that the artificial intelligence spending wave is still filling its factories. Its first-quarter gross margin reached 66.2%, above its own guidance range, as the company sold more of the advanced chips now in shortest supply. (investor.tsmc.com 1) (investor.tsmc.com 2)