Taiwan Semiconductor Manufacturing Co. (TSMC) reported a 30% increase in sales for the first two months of 2026, supported by ongoing investments in artificial intelligence infrastructure prior to the conflict in the Middle East. The robust results underscore that major technology companies have maintained strong orders for artificial intelligence chips, despite questions about potential overcapacity and new geopolitical risks.
TSMC, the largest contract chipmaker globally and a supplier to companies including Nvidia, AMD, and Broadcom, generated NT$718.9 billion in combined revenue in January and February. While analysts had projected first-quarter sales to rise about 33% from a year earlier, February’s growth slowed to 22%, partly attributed to disruptions from the Lunar New Year holiday.
The company’s performance is closely watched as an indicator of broader AI industry demand. Investors and industry observers have shifted focus toward the consequences of recent U.S. and Israeli strikes on Iran, evaluating how such geopolitical tensions might affect future investments in data centers and related digital infrastructure.
Global technology leaders such as Alphabet, Amazon.com, Meta Platforms, and Microsoft have allocated over $650 billion in collective spending for this year. Even so, concerns persist over a possible glut in data center capacity and ongoing challenges in generating revenue from new AI technologies.
Recently heightened geopolitical risks, particularly the escalation of conflict involving the U.S. and Iran, have contributed to market uncertainty regarding the pace of tech-sector infrastructure development. There is increasing attention on how these developments could constrain demand for advanced chips, particularly if technology firms moderate their expansion of data centers in response.
