Should You Buy Taiwan Semiconductor Manufacturing Stock Before Jan. 15?
Key Points
TSMC is expected to announce its Q4 2025 earnings on Jan. 15.
The first three quarters of the year saw double-digit growth in revenue, net income, and EPS.
TSMC is an excellent company, but it's better to buy as an investment, not a short-term earnings play.
- 10 stocks we like better than Taiwan Semiconductor Manufacturing ›
Taiwan Semiconductor Manufacturing (NYSE: TSM), the world's largest chip foundry, was a winning investment in 2025. Its share price rose 54%, and revenue hit a record high in the third quarter of 2025.
The manufacturer will announce its fourth-quarter results on Jan. 15. Should you buy TSMC stock before then? Let's find out.
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Image source: Taiwan Semiconductor Manufacturing.
How TSMC has performed post-earnings
TSMC delivered strong earnings reports over the first three quarters of 2025. In each quarter, revenue, net income, and earnings per share (EPS) saw significant year-over-year growth.
However, that didn't translate to an immediate increase in the company's share price. TSMC stock was flat the day after its first-quarter earnings release, and it dipped about 2% after its second- and third-quarter reports. Zooming out a little, its five-day returns after its second- and third-quarter earnings were also in the negative, although it did jump 8% in the five days following its first-quarter report.
Stock prices don't always correlate with earnings reports, especially over short periods of time. A company could have a great quarter but still see its stock drop, or its stock could increase even though it underperformed.
Should you buy TSMC?
TSMC makes semiconductors for many of the biggest tech companies, including Apple, Broadcom, and Nvidia. The demand for semiconductors has experienced rapid growth due to artificial intelligence (AI) technology, and TSMC is one of the companies that has benefited the most.
While there are concerns about an AI bubble, this is just one of the ways TSMC makes money. Its semiconductors power all kinds of modern electronics, including computers and smartphones.
TSMC is definitely worth considering -- but as an investment, not an earnings play. The most effective way to invest in stocks is to buy quality companies, such as TSMC, and adopt a long-term perspective. Decide if you'll invest based on where you think the company will be in five to 10 years, not after its next earnings report.
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Lyle Daly has positions in Broadcom and Nvidia. The Motley Fool has positions in and recommends Apple, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy.
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