warren buffett's $9 billion tsmc blunder

2025-07-16 tsmc

taipei, Wednesday, 16 July 2025.
warren buffett’s berkshire hathaway missed out on an estimated $9 billion usd profit. this happened when tsmc’s adr shares surged after berkshire sold its stake in may 2023. the decision to sell tsmc shares was influenced by geopolitical tensions surrounding taiwan. this move proved costly. tsmc’s adr value has since exceeded berkshire hathaway’s market capitalization, highlighting the magnitude of the missed opportunity. the surge underscores the potential gains foregone by buffett’s firm due to these geopolitical concerns.

Geopolitical factors and market reactions

Berkshire Hathaway’s decision to liquidate its TSMC holdings in May 2023 was driven by concerns over geopolitical tensions between Taiwan and China [1]. Warren Buffett cited these worries at Berkshire’s annual meeting, leading to the complete divestment of TSMC shares [1]. This decision triggered an immediate market reaction, causing TSMC’s adr stock to plummet by 5% [1]. The move highlights how geopolitical risks can significantly influence investment strategies and market stability, especially concerning major semiconductor manufacturers like TSMC [1].

Analysts bullish on tsmc despite pc order reductions

Despite concerns about reduced orders for 3-nanometer PC CPUs, analysts remain optimistic about TSMC’s revenue prospects [6]. These analysts anticipate that the reduced orders will be quickly offset by increased demand for cryptocurrency mining [6]. Morgan Stanley, in a report released on July 14, noted that TSMC’s second-quarter revenue reached nt$933 billion, a 16% increase quarter-over-quarter in usd terms [6]. This performance exceeded both the company’s previous forecasts and Morgan Stanley’s expectations [6]. The analysts project a 27% annual revenue growth for tsmc in 2025 [6].

Foreign investment and stock performance

The taiwan stock market closed up 220 points on july 16, 2025, reaching a nearly five-month high of 22,835 points [3]. On july 15, 2025, the taiwan stock exchange weighted index closed at 22,835.94 points, reflecting an increase of 220.97 points, or 0.98% [3]. Foreign investors exhibited strong confidence, with net purchases of nt$18.347 billion [3]. Investment trusts and proprietary traders also contributed, buying a net nt$3.371 billion worth of shares [3]. This collective investment activity underscores the positive market sentiment surrounding taiwanese stocks, particularly tsmc [3].

Nvidia’s h20 chip approval and supply chain boost

The u.s. government’s approval for nvidia to resume sales of its h20 chips to china has positively impacted tsmc and its supply chain partners [7]. Nvidia ceo jensen huang announced this development in beijing, which is expected to help nvidia clear previously restricted inventory [7]. Tsmc, a key manufacturer of nvidia’s chips, saw its shares rise to nt$1110, reflecting market optimism [7]. Other ai-related stocks, such as 欣興(3037), 景碩(3189), and 南電(8046), also experienced significant gains, hitting their daily increase limits [7]. This approval is viewed as a boon for taiwan’s semiconductor industry [7].

Morgan Stanley’s optimistic outlook for tsmc

Morgan Stanley has expressed a bullish outlook on tsmc, anticipating that the company’s substantial $165 billion investment in the united states will lead to exemptions from potential tariffs under a trump administration [6]. The firm recommends buying tsmc shares before the second-quarter financial report is released [6]. Morgan Stanley set a target price of nt$1,288, which represents a 17% upside from the current stock price [6]. This target exceeds tsmc’s announced stock repurchase price limit of nt$1,200 [6]. The firm cites sustained ai chip demand and leadership in advanced manufacturing as reasons for its positive outlook [6].

Bronnen

tsmc stock warren buffett