TSMC reports profit that beats forecasts despite rising demand for AI chips | business and economy

The world's largest contract chipmaker reported third-quarter net income of $10.1 billion.

Taiwan Semiconductor Manufacturing Company reported higher-than-forecast quarterly profit amid rising demand for artificial intelligence chips.

TSMC, the world's largest contract chipmaker, reported third-quarter net profit of 352.3 billion Taiwanese dollars ($10.1 billion), up 54.2 percent from the same period last year.

This figure represented the company's best quarterly performance to date and was well above market estimates.

According to TSMC, sales reached $23.5 billion, up 36 percent year over year. Sales growth of almost 30 percent is forecast for the year as a whole.

“Our third quarter business was supported by strong smartphone and AI-related demand for our industry-leading three-nanometer and five-nanometer technologies,” TSMC Chairman CC Wei said in a briefing to analysts.

“As we enter the fourth quarter, we expect our business to continue to be driven by strong demand for our leading process technologies.”

TSMC's strong performance comes days after Dutch company ASML, which supplies chip-making equipment to the Taiwanese company, forecast lower-than-expected sales next year, sending shares down 16 percent.

TSMC, Asia's most valuable listed company, has seen its share price rise 75 percent this year as the technology sector pours resources into developing and deploying AI.

The chipmaker is pushing to diversify production beyond Taiwan to reduce risks to its business amid rising geopolitical tensions between the United States and China, which views the self-ruled island as its territory.

Beijing held large-scale military exercises around the island on Monday, which included a simulated blockade.

TSMC said Thursday that it expects the first of three factories under construction in Arizona to reach mass production in 2025, with the second and third plants in 2028 and by the end of the year follow decade. respectively.