TSMC Stock Rises Nearly 3% Premarket As Traders Shrug Off Slower October Growth, AI Bubble Fears

• TSMC’s October sales rose 17% YoY, slowing from the 31.4% growth in September. 
• When reporting its third-quarter results in mid-October, TSMC guided revenue for the fourth quarter, which encompassed October, to be between $32.2 billion and $33.4 billion.
• Weighed down by AI growth worries, the Nasdaq Composite shed 3% last week, marking the worst weekly performance since early April.

Taiwan Semiconductor Manufacturing Co., Ltd. (TSMC) reported slower sales growth for October, which could reignite speculation about the potential bursting of the artificial intelligence (AI) bubble.  

In Monday’s early premarket session, TSMC’s stock rose nearly 3%, and TSMC’s key customer, Nvidia’s stock, was up more than 3%. Optimism regarding a stopgap funding deal to end the government shutdown may also be driving some of the upside.

TSMC’s Oct. Revenue

Hsinchu, Taiwan-based TSMC reported that its October sales totaled NT$367.47 billion (approximately $11.9 billion), marking a nearly 17% year-over-year (YoY) increase. The sales growth slowed markedly from the 31.4% pace reported for September. 

According to a Bloomberg report, the YoY sales growth marked the slowest pace since February 2024. 

When it reported its third-quarter results in mid-October, TSMC guided revenue for the fourth quarter, which encompassed October, to be between $32.2 billion and $33.4 billion. The midpoint of the guidance range suggests a 22% YoY revenue growth for the quarter.

What Retail Feels About TSMC 

On Stocktwits, retail sentiment toward TSMC stock shifted to ‘bearish’ as of early Monday from ‘neutral’ a day ago. The message volume on the stream stayed at ‘low’ levels.

A bearish watcher said while bulls believe that the AI bubble will last forever, “cracks are already starting to show.”

Evidence Of AI Slowdown Grows

The Nasdaq Composite shed 3% last week, marking the worst weekly performance since early April, when the tariff storm hit. The tech sell-off results from pessimism stirred by commentary regarding the AI bubble burst. 

While prominent short seller Michael Burry took massive short positions in Nvidia and Palantir, two of the AI darlings, Wall Street firms warned about trouble brewing on the AI horizon. Speaking at the Global Financial Leaders' Investment Summit in Hong Kong, Goldman Sachs’s David Solomon said, “Technology multiples are full.”

Nvidia Bumps Up TSMC Orders

Even as the AI bubble’s sustainability remains a concern, Nvidia has reportedly asked TSMC to manufacture more chips. While attending TSMC’s annual sports day this weekend, Nvidia CEO Jensen Huang said, “The business is very strong, and it’s growing month by month, stronger and stronger,” according to Bloomberg.

TSMC’s CEO, C.C. Wei, confirmed this and told reporters at the event that Huang had requested more wafers when the two met.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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