Taiwan Semiconductor Manufacturing Q3 Preview: With Stock Near 52-Week Highs, Here's What To Watch

Core Insights - Taiwan Semiconductor Manufacturing Co. (TSMC) is expected to report strong third-quarter financial results, with revenue anticipated to reach $31.50 billion, a significant increase from $23.50 billion in the same quarter last year [1][2] - The company has consistently outperformed analyst estimates for both revenue and earnings per share (EPS) over the past seven quarters, with EPS expected to rise to $2.59 from $1.94 year-over-year [2] - TSMC's stock has seen a rally, reflecting its critical role in the global AI supply chain and benefiting from increased demand in advanced semiconductor nodes [6][4] Financial Performance - Analysts predict third-quarter revenue guidance for TSMC to be between $31.8 billion and $33.0 billion [2] - In September 2025, TSMC reported consolidated net revenue of NT$330.98 billion, marking a 31.4% increase year-over-year but a slight decline of 1.4% from August [3] - The company achieved a 44% year-over-year revenue increase in the second quarter, with gross margins improving by 540 basis points to 58.6% [6] Market Position and Demand - TSMC is a key player in the semiconductor sector, benefiting from growth in artificial intelligence and high-performance computing [4][5] - Major clients include Apple Inc. and NVIDIA Corporation, which are among the largest companies globally by market capitalization [4] - Recent large-scale technology deals are expected to increase backlog demand for TSMC's chips [5] Stock Performance - TSMC shares are currently trading near all-time highs, despite geopolitical tensions and potential trade issues between the U.S. and China [5] - The stock is down 2.0% to $296.72, with a year-to-date increase of 47.1% in 2025 [8] Strategic Insights - TSMC's CEO highlighted investments in U.S. chip manufacturing and the resumption of AI chip sales to China as potential future growth catalysts [7] - The company has not yet observed changes in customer behavior due to tariffs, indicating resilience in its operations [7]