The Motley Foolยท2025-07-20 07:02Core Viewpoint - Investors are currently underestimating the growth potential of AI chipmaker Nvidia, despite recent concerns regarding future growth prospects and market uncertainties [2][12]. Group 1: TSMC's Performance - TSMC, the world's largest chip foundry, reported second-quarter revenue of $30.1 billion, reflecting a 39% year-over-year increase and an 11% quarter-over-quarter increase [6]. - The company's adjusted earnings per share (EPS) surged 61% to a record high of $2.47, driven by strong demand for high-performance computing (HPC) related to AI [6][7]. - TSMC raised its 2025 revenue forecast, now expecting a 30% increase in U.S. dollars, attributing this growth to robust AI and HPC-related demand [8]. Group 2: Nvidia's Financials - Nvidia's fiscal 2026 first-quarter revenue reached $44 billion, a 69% year-over-year increase, with data center revenue, including AI chips, soaring 69% to a record $39 billion [10]. - Gaming and PC revenue also increased by 42% to $3.8 billion, with data center sales accounting for 89% of total revenue [10]. - Nvidia is guiding for second-quarter revenue of approximately $45 billion, indicating a year-over-year growth of 50% [11]. Group 3: Market Outlook - Nvidia incurred a $4.5 billion charge due to export controls on H20 chips destined for China, but has applied for a license to resume sales, potentially worth up to $15 billion in the second half of the year [12]. - The evidence suggests that the AI revolution is ongoing, and with the resumption of chip sales to China, Nvidia has significant growth potential ahead [13].