1 Incredible Artificial Intelligence (AI) Stock to Buy and Hold for the Next 10 Years

Core Insights - The semiconductor industry, particularly companies like Taiwan Semiconductor Manufacturing Company (TSMC), is positioned to benefit significantly from the ongoing artificial intelligence (AI) boom, with the global AI market projected to generate nearly $2.6 trillion in annual revenue by 2032, up from an estimated $538 billion last year [1][6] Group 1: TSMC's Role in AI - TSMC is a key player in the AI semiconductor market, providing advanced manufacturing processes that enable companies like Nvidia to produce powerful AI chips [3][4] - TSMC's 4N and 4NP manufacturing processes are critical for Nvidia's Hopper and Blackwell AI processors, respectively, highlighting TSMC's importance in the AI chip supply chain [3][4] - A diverse range of customers, including Intel, Qualcomm, AMD, Apple, and Broadcom, rely on TSMC for chip production, indicating strong demand for TSMC's services [4][5] Group 2: Financial Performance and Growth - TSMC's revenue increased by 27% year-over-year in the first five months of 2024, a recovery from a decline in the previous year due to poor market demand [5] - The company holds a 62% market share in the foundry sector, significantly ahead of its closest competitor, Samsung, which allows TSMC to exercise pricing power [5] - TSMC plans to increase its advanced chip production capacity by 60% by 2026 to meet rising AI-related orders, further solidifying its market position [5] Group 3: Future Projections - Analysts project TSMC's earnings to grow at an annual rate of 21% over the next five years, with earnings per share expected to increase nearly 23% in 2024 and 25% in 2025 [7][9] - The AI chip market is anticipated to generate $372 billion in revenue by 2032, a substantial increase from $15 billion in 2022, indicating a long-term growth opportunity for TSMC [6] - TSMC's overall revenue could reach $180 billion by 2030, up from $69 billion in 2023, driven by the expanding AI market [9]