Taiwan Semiconductor (TSM) reported a stellar quarter with revenue of $33.73 billion, beating expectations by $400 million. Profits hit $16.3 billion, up 35% year on year. Management forecasts Q126 revenue between $34.6 and $35.8 billion, with impressive profit margins of 63-65% gross and 54-56% operating.

TSMC raised capex to $52-$56B for 2026, accelerating plant build-outs in Taiwan and Arizona. Aggressive investment reflects AI-driven demand and tight supply conditions. Hyperscalers are projected to spend $1 trillion annually on chips by 2028. TSMC’s backlog is unprecedented, with demand outstripping capacity until 2028.

TSMC’s A16 roadmap remains on track for volume production in H2 2026. A16 features SPR technology for efficiency gains. Demand is high, with NVIDIA as the lead customer. Apple hogs 2nm node production, while Broadcom muscles in on TSMC’s customer mix. High-Performance Computing now drives primary revenue.

Read more at Nasdaq: Taiwan Semi (TSM): 3 Equations to Launch the Stock