TSMC sales growth slows in January after DeepSeek roils market
Sign up now: Get ST's newsletters delivered to your inbox
Nvidia’s main chipmaker is grappling with industry-wide questions surrounding AI spending.
PHOTO: BLOOMBERG
Follow topic:
TAIPEI – Taiwan Semiconductor Manufacturing’s (TSMC) sales growth decelerated from the December quarter as Nvidia’s main chipmaker grapples with industry-wide questions surrounding spending on artificial intelligence (AI).
Revenue in January grew 36 per cent to NT$293.3 billion (S$12.1 billion), compared with a 38.8 per cent increase in the October-December period. Analysts on average are looking for a 41 per cent increase in sales from the go-to chipmaker for Nvidia and Apple in the current quarter through March.
Deciphering Taiwanese companies’ sales during the first months of the year is complicated by the multi-day Chinese New Year holiday, which can fall on either January or February.
Major tech companies including Microsoft, Alphabet and Meta Platforms have all announced plans to invest tens of billions of dollars in 2025 in AI and appeared unfazed by the success of the seemingly lower-cost models from Chinese start-up DeepSeek. Amazon.com alone is aiming to spend US$100 billion (S$135 billion) on AI.
Before DeepSeek roiled the market in January, TSMC said its capital expenditure may hit a record US$42 billion in 2025 on AI demand. That optimism was amplified by key TSMC equipment supplier ASML Holding after the DeepSeek saga.
TSMC’s outlook is overshadowed by US President Donald Trump’s threats to slap tariffs on semiconductor imports, although it is unclear whether that may indeed happen.
The company is expected to hold its board meeting in Arizona, home to its most advanced plant in the US, this week, according to Taiwan’s Minister of Economic Affairs J.W. Kuo. BLOOMBERG
