tsmc's ai boom: february revenue jumps 43.1%

2025-03-10 tsmc

Taipei, Monday, 10 March 2025.
taiwan semiconductor manufacturing co. (tsmc) reported a significant surge in revenue for february 2025, climbing 43.1% year-over-year to ntd 260 billion. this growth, marking the 14th consecutive month of increased sales, is fueled by robust demand for advanced semiconductors used in ai servers. analysts predict tsmc’s revenue will continue its upward trajectory, spurred by the ongoing expansion of ai infrastructure. tsmc’s success highlights the crucial role of semiconductor manufacturing in the burgeoning ai sector.

financial performance and market position

The february revenue reached ntd 260.09 billion, marking a 43.1% increase compared to february 2024 [4][8]. However, it represents an 11.3% decrease from january 2025 [4][8]. The cumulative revenue for january and february 2025 totaled ntd 553.3 billion, a 39.2% increase from the same period last year [2][8]. This growth surpasses the 34% growth rate recorded for the entire year 2024 [3]. Analysts predict a 41% revenue growth for the current quarter [2][3]. As the primary manufacturer of ai chips, tsmc’s sales serve as an indicator for the ai industry [4][8].

stock market reaction and analyst outlook

Despite strong revenue figures, tsmc’s stock on the taiwan stock exchange (tse) closed down 0.7% at ntd 998 per share [2]. Year-to-date, tsmc’s u.s. stock has declined by over 12% [2]. However, analysts remain optimistic, viewing tsmc’s strong market position and advanced technology as a solid long-term investment, suggesting the recent dip could be a buying opportunity [2]. Goldman sachs has given tsmc a ‘buy’ rating with a target price of ntd 1,400 on the tse and $259 for the adr [3]. Morgan stanley maintains an ‘overweight’ rating with a target price of ntd 1,388 [3]. Jpmorgan chase also maintains an ‘overweight’ rating, setting a price target of ntd 1,500 [3].

capacity expansion and geopolitical considerations

Tsmc is expanding its production capacity, particularly in the united states, with a planned investment increase of $100 billion [2][4]. This brings tsmc’s total investment in the u.s. to $165 billion, encompassing three new wafer fabs, two advanced packaging facilities, and a research and development center [2][4]. This move is seen as a response to potential u.s. tariffs on imported semiconductors and aims to address the significant demand from u.s. clients [3][4]. ceo c.c. wei noted that tsmc’s production lines are fully booked for this year and the next two years [3]. Cecilia chan, a bloomberg credit analyst, believes that the $100 billion investment will not impact tsmc’s credit rating, given its $44 billion in net cash [3][4].

challenges and uncertainties

Tsmc faces some challenges, including the potential impact of a recent earthquake in taiwan, which is expected to result in losses of approximately ntd 5.3 billion in the first quarter [2]. Additionally, there is uncertainty surrounding potential chip import tariffs from the u.s., particularly if donald trump is re-elected as president [3][4]. While tsmc’s expansion in the u.s. is partly aimed at mitigating this risk, concerns remain about the potential transfer of advanced technology away from taiwan [4]. Despite increased u.s. investment, goldman sachs indicates that tsmc’s long-term gross margin guidance remains at 53% or higher [3].

Bronnen

revenue growth ai demand