Taiwan Semiconductor Manufacturing Company (TSMC) announced a nearly 61% year-over-year surge in second-quarter net profit, reaching a record high driven by sustained, strong demand for its advanced artificial intelligence chips.
For the quarter ending in June, the company reported a net income of NT$398.27 billion, surpassing analyst expectations of NT$377.86 billion. Revenue also exceeded forecasts, rising 38.65% from the previous year to NT$933.80 billion ($31.7 billion).
The strong performance was largely fueled by sales of the company’s most advanced semiconductors. Chips featuring 7-nanometer or smaller process technology accounted for 74% of total wafer revenue for the quarter. In semiconductor manufacturing, smaller nanometer sizes allow for more compact and efficient transistors, resulting in greater processing power.
As the world’s largest contract chip manufacturer, TSMC is a key beneficiary of the global AI boom, producing high-performance processors for major clients such as Nvidia and Apple.
Despite the record earnings, the company faces potential headwinds from U.S. trade policy. Taiwan is currently in trade negotiations with the U.S. following a 32% tariff announced in April, and former President Donald Trump has also warned of potential additional tariffs specifically targeting semiconductors.
U.S. export controls have also posed a challenge, restricting TSMC’s business with China and that of key clients like Nvidia and AMD. However, in a recent sign of easing trade tensions between Washington and Beijing, both Nvidia and AMD confirmed this week that they have received government approval to resume shipping certain products to China.
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