A retreat in chip stocks has raised the stakes for TSMC’s Thursday results, with investors looking to its earnings and forecasts for evidence that AI-driven growth remains intact. The world’s largest producer of advanced AI chips is projected to deliver its sixth successive quarterly earnings record, supported by heavy technology-sector infrastructure spending.
TSMC’s third-quarter profit forecast stands at NT$746.3 billion ($23.4 billion), representing annual growth of 65%, according to an LSEG SmartEstimate drawing on 16 analysts. The calculation gives more influence to analysts with stronger forecasting records.
Quarterly net income exceeding NT$706.56 billion would establish a company record and extend its run of profit increases to 11 quarters. TSMC has already disclosed quarterly revenue growth of 51%.
Analysts continue to see robust demand both for its AI semiconductor production and for CoWoS, its advanced packaging technology. Alongside that demand, investors will assess whether profitability can withstand the company’s expanding investment program.
For the quarter ending in September, analysts project a gross margin of 66.5%. That would put profitability close to the upper end of TSMC’s forecast, though slightly below the record achieved in the preceding quarter.
Capital expenditure is another focus for shareholders, with forecasts for 2027 spending moving higher. The figure is regarded as an important driver of TSMC’s share price.
Goldman Sachs estimates spending of $85 billion in 2027, while UBS expects $90 billion. Both are above the $75 billion average in a Bloomberg survey.
TSMC had already increased its investment budget during its July results call. It set this year’s capital expenditure range at $60 billion to $64 billion, replacing an earlier expectation for spending near the upper boundary of a $52 billion-to-$56 billion range.
Its Arizona factory program represents an investment of $265 billion, including a further $100 billion announced in July. Texas could also feature in its expansion: Reuters reported in September that TSMC was assessing a possible investment there.
Separately, Tesla chief executive Elon Musk said last week that his companies would construct and run the Terafab AI chip complex. TSMC could sublease a portion of that facility, he said.
Thursday’s call begins at 06.00 a.m. GMT and will include a fourth-quarter outlook and revisions to full-year guidance. It follows Wednesday’s pressure on AI shares as concerns about additional Federal Reserve rate increases hit stocks sensitive to borrowing costs.
Concerns about financing for artificial intelligence have pulled TSMC into a wider semiconductor selloff over the past week. Strong recent performances from Samsung Electronics and ASML have not dispelled investor unease about the sector.
Earlier this month, TSMC shares reached a new peak, making the company one of the first semiconductor businesses worldwide to recover its previous high following July’s slump. Its strength relative to competitors reflects its leading role in contract production of processors supporting new AI agents from companies including Meta Platforms.
Beyond the financial forecasts, investors will examine management’s assessment of obstacles affecting data center development. Its comments on electricity-grid limitations, regulatory barriers and opposition from local communities will be watched for signs of their impact.
