TSMC’s strong sales growth in May reflects high demand for AI chips.
On Friday, June 7th, TSMC disclosed its latest monthly data, revealing that the company’s sales revenue for May reached NT$229.62 billion (approximately $7.14 billion USD), marking a 30.1% year-on-year increase. From January to May this year, TSMC’s cumulative sales revenue reached NT$1.06 trillion (approximately $32.839 billion USD), a 27% increase year-on-year.
Media reports suggest that the global rush to build data centers, driven by the AI wave, has enabled TSMC to maintain high profit margins.
During the shareholders’ meeting on June 4th, the then-chairman of TSMC, Mark Liu, stated that AI demand is more optimistic compared to a year ago. With increasing demands from AI applications and chips, TSMC is confident about its future growth.
Following the meeting, TSMC’s newly appointed chairman, Wei Zhejia, hinted at a potential increase in prices for AI chip manufacturing services. Huang Renxun, the founder and CEO of one of TSMC’s major clients, NVIDIA, responded the next day, stating:
“TSMC’s prices are too low.”
“In terms of TSMC’s contribution to the world and the tech industry, their financial numbers are clearly underestimated.”
Following these remarks, Morgan Stanley promptly released a report raising TSMC’s target price to NT$980, maintaining an “overweight” rating, citing optimism about the logic behind the price hike. They predict that within two years, the average selling price of 3nm wafers will increase by 11%, 4nm wafers by 3%, and CoWoS packaging prices by 20%.
Today, TSMC’s stock (2330.TW) opened high and continued to rise, but as of the time of writing, it was down 1.68%. Overnight, its stock price on the US market reached an all-time high during trading.
