Shares jump as TSMC posts record Q4 numbers

(Sharecast News) - TSMC posted record quarterly earnings on Thursday, as it predicted demand for its high-tech chips would continue to boom. The Taiwanese semiconductor manufacturer, the world's largest, saw revenues surge by more than a fifth in the three months to December end - up 20.5% at NT$1,046bn ($33.7bn) - on the back of the artificial intelligence boom.

Net income came in at an above-forecast NT$505.7bn, a 35% spike, while the gross margin was 62.3%.

Earnings per share were 9% higher-than-expected, at NT$19.50.

TSMC makes more than 90% of the world's most advanced chips, supplying companies including Nvidia, AMD, Broadcom and Apple.

Its New York-listed shares have put on more than 160% over the last five years, as demand for AI exploded and sales of its high-tech chips soared.

Looking ahead, and TSMC remained bullish.

It pencilled in first-quarter revenues of between $34.6bn and $35.8bn, with a gross profit margin of between 63% and 65%.

The full-year capital budget is expected to be between $52bn and $56bn, a 32% hike year-on-year, with AI revenues slated to grow by between 55% and 59% annually out to 2029.

Wendell Huang, chief financial officer, said: "Our business in the fourth quarter was supported by strong demand for our leading-edge process technologies.

"Moving into the first quarter 2026, we expect our business to be supported by continued strong demand."

As at 1100 GMT, TSMC's New York-listed shares had put on 5% in pre-market trading.

Others in the sector trading higher following the results included Nvidia, up 2%, while in Europe, ASML and BE Semiconductor both spiked 5%.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: "This is a clear signal. TSMC is typically cautious on capacity, given the chip industry's boom-and-bust cycle, so this aggressive build-out suggests they see a durable runway for AI demand stretching well into the next decade.

"This matters far more beyond TSMC. The growth in capex planned for 2026, along with a signal of more to come, is a green light for the entire AI infrastructure trade.

"In short, these results aren't just good for TSMC, they're a roadmap for where the next leg of AI investment is heading."