TSMC shares hit record high after Q3 profit surge

Taiwan Semiconductor Manufacturing Co. (TSMC) experienced a remarkable day on October 18, with its shares closing at an all-time high following the release of impressive third-quarter results. The world's largest contract chipmaker reported a 54% surge in quarterly profit, surpassing analyst projections and demonstrating strong growth momentum, particularly in the artificial intelligence (AI) sector.

TSMC's shares rose 4.8% to close at US$33.77, breaking its previous record set in July. This surge propelled TSMC to become Asia's most valuable company, with a market capitalization of around $874 billion. The company's success lifted Taiwan's Taiex index by 1.9%.

The chipmaker's strong performance was attributed to robust AI demand, solid execution, and improved utilization rates in advanced nodes. Revenue from 3-nanometer chips increased significantly, driven by AI GPU demand and recent smartphone launches. TSMC's high-performance computing segment, which includes AI chips, accounted for 51% of overall revenue in Q3.

Looking ahead, TSMC provided an optimistic outlook for Q4, projecting revenue between US$26.1 billion and US$26.9 billion, with an expected gross profit margin of 57-59%. The company anticipates its revenue from AI-related servers and processors to triple this year, representing about 15% of total revenue.

In contrast, Samsung Electronics faced challenges on the same day. Sources reported that the South Korean giant postponed deliveries of chipmaking equipment from Dutch firm ASML for its upcoming Texas factory, reportedly due to a lack of major customers for the project.