TSMC Delivers Strong Results — Can High-Cost Expansion Sustain Long-Term Profitability?

TradingKey – TSMC yesterday reported its May 2025 monthly revenue , which reached NT$320.516 billion , representing a monthly decline of 8.3% , but a significant year-over-year increase of 39.6%, setting the second-highest record in company history and slightly exceeding market expectations.

【TSMC Intraday Chart, Source: Futu】

The company pointed out that despite being affected by the earthquake in Japan in Q1, its quarterly revenue still exceeded NT$820 billion, meeting its earlier financial guidance. Looking ahead to Q2, it expects a modest seasonal decline in revenue, but has maintained its full-year USD revenue growth target of 24%–26%. AI-related revenue is expected to double this year, with a CAGR of 44%–46% projected from 2024 to 2029, making AI the key growth driver for its high-performance computing platform.

TSMC Chairman C.C. Wei emphasized that 2025 will be a strong growth year, with global semiconductor industry output expected to grow by about 10%. He noted that TSMC’s growth momentum remains stronger than the overall market and reaffirmed the company's goal of maintaining an average annual growth rate of nearly 20% over the next five years.

In terms of advanced process development, TSMC announced that its 2nm technology will enter mass production in the second half of 2025 and is now open for customer orders — further strengthening its technological leadership.

Additionally, in March, TSMC announced an additional US$100 billion investment in the United States to hedge against potential tariff risks. This move is expected to help the company avoid possible “reciprocal tariffs” from the U.S. government.

Financial institutions such as Puyin International have pointed out that TSMC’s Q1 results and Q2 outlook have already exceeded market expectations. With the explosive growth potential of AI-driven revenue, the company may once again surpass analysts’ forecasts for the full year.

However, some analysts caution that rising costs due to overseas expansion and uncertainty around U.S. trade policies should not be overlooked. That said, TSMC’s technological edge and strong client relationships are seen as key factors that can help cushion any negative impacts.