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TSMC posts record profit on relentless AI chip demand and raises revenue outlook

Taiwan Semiconductor Manufacturing Co. posted record quarterly profit for the sixth consecutive quarter and raised its fourth-quarter revenue guidance well above analyst forecasts, citing intense global appetite for advanced artificial intelligence chips.

TSMC logo and wafer emblem on the exterior facade of a building under a cloudy sky.
Image: @gurgavin

Taiwan Semiconductor Manufacturing Co. reported a 68.7% year-over-year surge in net profit to NT$763.1 billion for the third quarter of 2026, marking its sixth consecutive quarter of record earnings, according to reports by CNBC and unusual_whales. Revenue climbed 41.2% in U.S. dollar terms to $46.72 billion (NT$1,494.24 billion), beating Wall Street forecasts and generating an adjusted earnings per share of $4.60, as tracked by financial analyst Shay Boloor and Wall St Engine.[1][2][4][6][12][13]

The semiconductor foundry saw gross margin hit 66.4% and operating margin reach 58.7%, exceeding its prior 58% operating guidance. Advanced nodes at 7 nanometers and below accounted for 79% of third-quarter wafer revenue, with 3-nanometer chips contributing 33% and high-performance computing accounting for 68% of platform revenue. Free cash flow surged during the quarter to NT$476.56 billion, compared to NT$139.38 billion a year earlier.[4][6][13]

For the fourth quarter, TSMC forecast revenue of $52.30 billion to $54.30 billion, outpacing consensus projections of $49.07 billion. The company projected gross margins between 65.0% and 67.0% alongside operating margins between 56.5% and 58.5%, assuming an exchange rate of NT$31.8 per U.S. dollar, according to guidance reported by Wall St Engine.[8][11]

TSMC Chief Executive C.C. Wei described AI chip demand as extremely strong with no sign of a slowdown, stating that customer demand continues to exceed foundry supply despite industry concerns over capacity buildouts. Wei remarked during the earnings call that there is no ceiling on TSMC's profitability, noting that AI accelerator revenue could outpace previous projections of a 50% compound annual growth rate through 2029.[3][5][7][9]

Key facts

  • TSMC posted record net profit for the sixth consecutive quarter, climbing 68.7% year over year to NT$763.1 billion in Q3 2026.
  • TSMC Q3 revenue was $46.72 billion (NT$1,494.24 billion), up 41.2% in USD and 50.9% in NTD, beating estimates.
  • Q3 earnings per ADR reached $4.60, above consensus expectations.
  • Advanced nodes measuring 7nm and below represented 79% of TSMC's Q3 wafer revenue, led by 3nm at 33% and 5nm at 28%.
  • TSMC's Q3 operating margin came in at 58.7%, exceeding company guidance of 58%, while free cash flow reached NT$476.56 billion.
  • TSMC guided Q4 2026 revenue to $52.30 billion–$54.30 billion, surpassing analyst estimates of $49.07 billion, on gross margins of 65.0%–67.0%.
  • CEO C.C. Wei stated that AI demand remains exceptionally strong with no signs of slowing down, affirming that demand continues to exceed supply.

Sources · 11 sources

  1. CN

    CNBC@CNBCPost on X ·

    Taiwan Semiconductor Manufacturing Co. on Thursday reported a record third-quarter profit that beat estimates, powered by an unrelenting global appetite for AI chips. The world’s largest contract chipmaker posted a record net profit for a sixth straight quarter, reporting 68.7% surge in the reported quarter from a year earlier: https://t.co/G9Jf3T2HBK

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  2. NA

    Nikkei Asia@NikkeiAsiaPost on X ·

    TSMC profit soars 69% in another record quarter fueled by AI boom https://t.co/zT3mQFJ0mB

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  3. CB

    Crypto BriefingArticle ·

    TSMC CEO C.C. Wei sees no slowdown as chip foundry posts record profit TSMC's sustained growth amid high chip demand highlights its pivotal role in tech innovation, but macroeconomic uncertainties loom. The post TSMC CEO C.C. Wei sees no slowdown as chip foundry posts record profit appeared first on Crypto Briefing .

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  4. SB

    Shay Boloor@StockSavvyShayPost on X ·

    $TSM Q3 EARNINGS • Revenue $46.7B vs Est. $44.9B (+41% YoY) • EPS $4.60 vs Est. $4.48 • Gross margin 66% vs Est. 66% • Net income $23.9B vs Est. $23.1B • Advanced nodes (≤7nm) were 79% of wafer revenue Q4 Guidance • Revenue $53.3B vs Est. $49.1B • Gross margin 66% vs Est. 65% • Operating margin 58% vs Est. 57% TSMC expects continued strong demand for advanced chips and a steep ramp in 2nm production during Q4.

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  5. MA

    MarketWatch@MarketWatchPost on X ·

    TSMC CEO sees no sign of a slowdown as chip foundry reports record profit https://t.co/2Hu3mgiheW

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  6. UW

    unusual_whales@unusual_whalesPost on X ·

    BREAKING: TSMC reported third-quarter net profit of NT$763.1 billion, up 68.7% from a year earlier. TSMC’s third-quarter operating margin came in at 58.7%, exceeding the guidance of 58% The company’s free cash flow surged to NT$476.56 billion, from NT$139.38 billion a year ago

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  7. SE

    Serenity@aleabitoredditPost on X ·

    $TSM released earnings today. I was more curious about commentary given recent the market panic. For analyst Q&A rounds: Q: Citi explicitly challenged TSMC on AI financing, HBM, CoWoS, lasers and the risk of overbuilding capacity A: $TSM assessed CSP capex, DC construction conditions, customer financial conditions, and supply of critical components. Management's conclusion is still that "demand exceeds supply". As well as that AI accelerator revenue growth could exceed its previous 50%+ CAGR projection through 2029. This is a more meaningful statement since it addresses some concerns regarding recent selloff. Q: JPM asked if wafer supply could be tighter in 2027 than in 2026 (demand visibility) A: Wei (Chairman/CEO) stated $TSM even sends staff to verify DC construction progress on site. And after assessing all the factors, TSMC believes gap between supply and demand remains substantial. It could not determine whether the extent of the gap given customers continues to increase demand. Q: On pricing power: A: Wei responded that there is "no ceiling on TSMC's profitability" but that profits will not surge dramatically overnight. (Source: NextApple, Taiwanese press) Regarding earnings, very strong: as usual - TSMC record profits of $23.6B (68% Y/Y growth), and revenue jumping to $46.72B, beating expectations. - Q4 Guidance was $52.3-$54.3B revenue off 65-67% gross margins. TLDR: - No signs of any slowdown or collapse as AI demand far exceeds supply for foreseeable future. $TSM is probably the fundamental proxy/canary to how the overall AI semi trade is doing. - On financing concerns and fear of overcapacity showing up in semiconductor demand: $TSM specifically examined the risks investors are concerned about now and assessment still points to unmet demand. During the Q&A session, Wei said AI demand was "very, extremely strong," with absolutely no signs of slowing. Underlying AI semi supply chain growth is healthier than recent market panic suggest.

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  8. WS

    Wall St Engine@wallstenginePost on X ·

    TSMC $TSM Q4’26 GUIDE Q4’26 Guide: 🔹 Revenue: $52.30B-$54.30B (Est. $49.07B) 🟢 🔹 Gross Margin: 65.0%-67.0% (Est. 65.5%) 🟡 🔹 Oper Margin: 56.5%-58.5% (Est. 57.3%) 🟡 🔹 FX Assumption: US$1 = NT$31.8 Comments: 🔸 “Moving into fourth quarter 2026, we expect our business to be supported by continued strong demand for our leading-edge process technologies, including the steep ramp-up of our 2-nanometer technology.”

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  9. TR

    TrendSpider@TrendSpiderPost on X ·

    $TSM Q3 EARNINGS DOUBLE BEAT EPS: $4.60 vs $4.45 est ✅ Sales: $46.72B vs $45.62B est ✅ Raised Q4 Sales Guidance ✅ CEO C.C. Wei: There is "no ceiling" to the company's profitability. https://t.co/1bTAUSGT5q

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  10. GU

    GURGAVIN@gurgavinPost on X ·

    TSMC JUST REPORTED EARNINGS *TSMC 3Q REVENUE $46.72B, EST. $45.7B ( BEAT ✅ ) *TSMC 3Q ADJ EPS $4.60, EST. $4.52 ( BEAT ✅ ) $TSM https://t.co/mOBwl3dfvc

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  11. QU

    Quartz@qzPost on X ·

    TSMC posted a record 69% jump in quarterly profit as AI chip demand held up: The chipmaker forecast fourth-quarter revenue of U.​S.​$52.​3 billion to U.​S.​$54.​3 billion and 2026 growth of around 44% dlvr.​it/TVwdt7 https://t.co/WL9hHZjOnv

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  12. CB

    Crypto BriefingArticle ·

    TSMC posts $46.72 billion Q3 2026 revenue, up 41.2% as AI demand keeps climbing TSMC's revenue surge highlights the growing dominance of AI in tech, potentially reshaping global semiconductor market dynamics. The post TSMC posts $46.72 billion Q3 2026 revenue, up 41.2% as AI demand keeps climbing appeared first on Crypto Briefing .

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  13. WS

    Wall St Engine@wallstenginePost on X ·

    TSMC $TSM Q3’26 EARNINGS HIGHLIGHTS 🔹 Revenue: $46.72B (Est. $44.93B) 🟢; +41.2% YoY 🔹 EPS: $4.60 (Est. $4.48) 🟢; per ADR 🔹 Gross Margin: 66.4% (Est. 66.3%) 🟡 🔹 Oper Margin: 58.7% (Est. 57.7%) 🟢 🔹 Net Income: NT$763.06B (Est. NT$737.9B) 🟢 🔹 Net Profit Margin: 51.1% Revenue by Platform: 🔹 HPC: 68%; +22% QoQ 🔹 Smartphone: 21%; +10% QoQ 🔹 IoT: 4%; +5% QoQ 🔹 Automotive: 4%; +23% QoQ 🔹 DCE: 1%; -12% QoQ 🔹 Others: 2%; -10% QoQ Technology Mix (Wafer Revenue): 🔹 2nm: 8% 🔹 3nm: 33% 🔹 5nm: 28% 🔹 7nm: 10% 🔹 7nm and below: 79% Other Q3 Metrics: 🔹 Wafer Shipments: 4,476 Kpcs; +9.6% YoY 🔹 North America: 79% of revenue 🔹 ROE: 45.5% 🔹 OpEx: 7.8% of revenue 🔹 Inventory Days: 82; -5 days QoQ 🔹 CapEx: $13.84B; $40.64B YTD 🔹 Free Cash Flow: NT$476.56B Key Updates: 🔸 Gross margin was 1.3 ppts lower than 2Q26, primarily due to the margin dilution from the initial ramp-up of N2 technology. 🔸 Non-operating items were a gain of NT$34.59B, vs NT$95.83B in 2Q26, which included disposal and mark-to-market gains on VIS shares. 🔸 Diluted EPS NT$29.43 (+68.7% YoY); revenue NT$1,494.24B (+50.9% YoY)

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