TSMC posts a sixth straight record profit as AI chip demand keeps climbing

Taiwan Semiconductor Manufacturing Co. (TSMC), which makes chips for companies such as Nvidia and Apple, reported its sixth consecutive quarter of record profit on 15 October 2026. Net profit for July to September rose nearly 69% from a year earlier to NT$763.06 billion, or about US$23.55 billion, ahead of the NT$746.3 billion analysts expected in a Reuters/LSEG poll, according to Investing.com.

Revenue climbed about 50% to NT$1.49 trillion. The company's gross margin was 66.4%, its operating margin 58.7% and its net margin 51.1%. Digitimes reported that the build-out of TSMC's newest 2-nanometre production is weighing on margins, even as profits keep setting records.

Advanced chips lead the way

TSMC's most advanced processes are taking a growing share of its business. Chips made with its 3-nanometre technology accounted for 33% of wafer revenue in the quarter, and the new 2-nanometre generation already contributed 8%, according to Investing.com. These processes are used for the high-end processors inside AI data centres and flagship smartphones.

“The AI market continues to be very strong,” chief executive C.C. Wei said. He also said the company is “working very hard to increase our capacity in the U.S.,” where TSMC is building chip factories in Arizona.

Outlook

TSMC forecast fourth-quarter revenue of US$52.3 billion to US$54.3 billion and said it expects revenue for 2026 as a whole to grow about 44% in US dollar terms. It kept its capital budget for the year at US$60 billion to US$65 billion, and chief financial officer Wendell Huang said spending would be “significantly higher” in the coming years. The company expects the cost of expanding capacity to reduce its gross margin by about two percentage points this year.

A rough week for chip stocks

The strong numbers arrived during a difficult stretch for chipmakers' shares. Investors have been selling semiconductor and AI stocks amid worries about valuations and rising US interest rates, and an exchange-traded fund that tracks US-listed chip companies was heading for a ninth straight daily decline, its longest losing streak since 2006, Yahoo Finance reported. Results from TSMC's biggest customers in the coming weeks will show whether spending on AI hardware is still accelerating.