TSMC sales quicken in first two months of 2025 in upbeat note for AI
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TSMC's revenue climbed 39 per cent in January and February 2025 from a year ago, in a sign of resilient demand for the Nvidia chips that power AI development.
PHOTO: REUTERS
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TAIPEI – Taiwan Semiconductor Manufacturing Company’s revenue climbed 39 per cent in the first two months, quickening from 2024 in a sign of resilient demand for the Nvidia chips that power artificial intelligence (AI) development.
The world’s largest chipmaker reported combined revenue for the first two months of NT$553.3 billion (S$22.4 billion). That compares with 34 per cent growth during the full-year of 2024. Analysts on average are projecting growth of about 41 per cent this quarter.
As the manufacturer of most of the AI chips in the world, TSMC’s sales are a barometer for the sector. Wall Street and Silicon Valley are now debating the sustainability of an AI frenzy that made Nvidia the world’s most valuable company, especially after China’s DeepSeek appeared to demonstrate a more frugal approach.
Last week, Broadcom became the latest big tech firm to offer reassurance that spending on artificial intelligence computing remains healthy. Before that, Taiwanese bellwether Hon Hai Precision Industry posted a 25 per cent rise in revenue during the first two months of 2025, also accelerating from 2024.
One major uncertainty TSMC faces in 2025 is whether US President Donald Trump will slap tariffs on chip imports. TSMC may have benefited from front-loading or stockpiling ahead of that potential move.
Last week, the Taiwanese company’s chief executive joined Mr Trump in the White House to outline an additional US$100 billion (S$133.14 billion) investment – one of the largest outlays by a foreign firm in US manufacturing.
The move was widely viewed as intended to stave off tariffs, though it raised concerns that advanced technology could be moving away from Taiwan.
Bloomberg Intelligence credit analyst Cecilia Chan pointed out in a report that the US$100 billion additional investment announcement would not impact TSMC’s credit ratings as it has a record-high net cash position of US$44 billion.
But it could lengthen the break-even time and impact margins further if Chips Act funding was cut off, which Mr Trump has called for. BLOOMBERG
