TSM Stock Spikes Overnight: Q1 Print Tops Estimates On Strong Demand For AI Chips, Advanced Processors

• TSM’s Q1 net income hit NT$572.48 billion, up 58% from the previous year and above estimates of NT$553.4 billion.
• Advanced nodes (7nm and below) contributed 74% of wafer revenue, including 25% from 3nm chips alone.
• North America generated 76% of revenue.

U.S.-listed shares of Taiwan Semiconductor Manufacturing Company (TSM) rose over 1% in overnight trading early Thursday after the chipmaker beat first-quarter (Q1) estimates on both revenue and profit as strong demand for 3nm chips and high-performance computing (HPC) continued to drive growth.

TSM stock fell over 1% to $375.1 on Wednesday, but climbed marginally in extended trading. 

TSM Q1 Review

TSM reported net income of NT$572.48 billion ($18.14 billion) in Q1, up 58% from the previous year and above Fiscal AI estimates of NT$553.4 billion, while diluted earnings per share (EPS) came in at NT$22.08, exceeding estimates of NT$20.96. The company also reported revenue of NT$1.134 trillion, rising 35% from a year ago and ahead of estimates of NT$1.117 trillion.

Advanced process tech remained the backbone of TSM’s revenue growth during the quarter. 3-nanometer chips accounted for 25% of wafer revenue, while 5-nanometer chips contributed 36% and 7-nanometer chips represented 13%, with 7nm and more advanced technologies making up 74% of total wafer revenue.

In U.S. dollar terms, quarterly revenue hit $35.9 billion, rising 41% from a year ago and 6.4% from the previous quarter. Meanwhile, gross margin for the quarter came in at 66%, operating margin reached 58%, and net profit margin stood at 51%.

HPC Drives Majority Of TSMC Revenue

HPC continued to dominate the company’s revenue mix. The segment accounted for 61% of total revenue, underscoring its role as TSM’s largest growth engine, as AI-related workloads drive strong semiconductor demand. Smartphones contributed 26% of revenue, while IoT accounted for 6% and automotive for 4%.

Revenue from high-performance computing increased 20% from the previous quarter, while smartphone revenue declined 11% from the prior quarter. Geographically, North America accounted for 76% of revenue, followed by Asia Pacific at 9%, China at 7%, and Japan and EMEA each contributing 4%.

How Do Retail Traders Feel About TSM?

On Stocktwits, retail sentiment for TSM was ‘extremely bullish’ amid over a 240% surge in 24-hour message volume.

One user urged traders to stay short on the stock, saying, “Even if this pops, Japan and London investors sell overnight and leaves nothing for US investors.”

Another user said, “This is going to make the semiconductors rally again nice! AI is still alive.”

TSM stock has jumped 141% over the past year.

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$1=NT$31.56

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