Taiwan Semiconductor Manufacturing Company, or TSMC (NYSE:TSM), reported record second-quarter earnings on Thursday as booming demand for artificial intelligence chips continued to fuel strong growth across its business. The chipmaker also raised its full-year revenue outlook and significantly increased its planned capital spending for 2026.
AI demand fuels another record quarter
TSMC posted net income of T$706.56 billion (US$21.98 billion) for the three months ended June 30, comfortably exceeding Bloomberg consensus estimates of T$623.73 billion.
The result represented a 77.4% increase from a year earlier and marked the fifth consecutive quarter in which the company delivered record earnings.
Quarterly revenue also reached a new high of T$1.27 trillion (US$39 billion), up 36% year over year, highlighting continued strength in demand for the company’s advanced semiconductor manufacturing services.
Arizona expansion and higher capital spending
Chief Executive C.C. Wei said TSMC will invest an additional US$100 billion to expand production capacity in Arizona, strengthening its manufacturing footprint in the United States alongside its existing operations in Taiwan and Japan.
The company also sharply increased its 2026 capital expenditure forecast to between US$60 billion and US$64 billion, compared with its previous guidance of US$52 billion to US$56 billion.
“The AI megatrend continues to drive the need for more and more computation, which supports the demand for leading-edge silicon,” CEO C.C. Wei said during the post-earnings conference call.
Wei added that customer demand remains exceptionally strong, requiring TSMC to accelerate capacity expansion.
Revenue outlook lifted despite margin pressure
Chief Financial Officer Wendell Huang forecast third-quarter revenue of between US$44.6 billion and US$45.8 billion, with an operating margin of 56% to 58%.
Huang also cautioned that gross margin will come under pressure due to the “extreme” production ramp-up of the company’s advanced 2-nanometre manufacturing technology.
Reflecting continued momentum in AI-related spending, TSMC now expects its 2026 revenue to grow by more than 40% in US dollar terms, compared with its previous outlook for growth of more than 30%.
AI boom continues to support long-term growth
The latest results reinforce TSMC’s central role in the global semiconductor industry as investment in artificial intelligence infrastructure continues to accelerate.
As the primary manufacturing partner for companies including NVIDIA Corporation (NASDAQ:NVDA) and Apple Inc. (NASDAQ:AAPL), TSMC produces advanced chips used in AI servers, smartphones, consumer electronics and a wide range of high-performance computing applications.
Taiwan Semiconductor stock price
