TSMC posted a 77.4% year-on-year profit jump in Q2

Taiwan’s largest chipmaker, TSMC, reported another blockbuster quarter on Thursday as strong demand for AI chips continued to drive growth.

The company said its net profit jumped 77.4% from a year earlier and rose 23.4% from the previous quarter, marking its fifth consecutive record quarter.

Revenue increased 36% year over year to NT$1.27 trillion (about $39.45 billion). Both revenue and profit exceeded Wall Street’s expectations, which had forecast revenue of NT$1.264 trillion and net income of NT$632.64 billion.

Alongside the strong results, TSMC’s CEO announced a new $100 billion investment to further expand the company’s operations in Arizona.

The findings demonstrate how crucial TSMC has become to the global movement toward AI. The company produces semiconductors for some of the biggest brands in the tech sector, including Apple, Broadcom, and Nvidia.

66% of all sales in the second quarter came from chips intended for high-performance computing, the market that includes AI processors. At 22%, smartphones were the next biggest contributor.

Production-wise, the company’s most sophisticated manufacturing techniques kept up the good work. Seventy-seven percent of wafer sales came from chip technologies that were smaller than seven nanometers. 33% of the amount came from the 5-nanometer process, whereas 30% came from the 3-nanometer process.

Guidance raised as AI orders hold strong

CEO C.C. Wei said AI-related orders remain as strong as ever. “AI-related demand continues to be extremely robust,” he said.

The company expects revenue of between $44.6 billion and $45.8 billion in the current quarter, with an operating profit margin in the range of 56% to 58%.

To meet that level of growth, chief financial officer Wendell Huang confirmed that TSMC has lifted its annual capital spending target to between $60 billion and $64 billion.

Arizona investment climbs to $265 billion

The sharpest news out of Thursday’s announcements, though, was the Arizona update. Wei said the company will invest an additional $100 billion in the state, taking its total committed spending there to $265 billion.

According to him, the money is intended for cutting-edge chip packaging facilities and new fabrication units that can produce at the 2-nanometer level, which is one of the most precise chip-making techniques now in use.

“This is to build several or more semiconductor logical wafer fab for two nanometer MP [mass production] technologies, as well as advanced packaging fabs to support the strong multi-year demand from our leading U.S. customers,” Wei stated.

He pointed out that in addition to the eight plants that have already been announced or are under construction, perhaps four more could be created, bringing the total number of state-of-the-art facilities in the US to twelve.

For the Trump administration, the expansion represents a significant victory. It comes after Washington and Taipei concluded a trade and investment deal earlier this year.

TSMC had already agreed to increase its initial $65 billion U.S. commitment by an additional $100 billion as part of that agreement, which was announced in March 2025 with President Trump and Commerce Secretary Howard Lutnick.

Lutnick praised the latest news

“President Trump’s leadership is driving companies to invest in American manufacturing. TSMC’s announcement of an additional $100 billion investment following our historic deal on trade and investment with Taiwan will create tens of thousands of American jobs and bring advanced semiconductor manufacturing back to America,” he said.

In response, Wei emphasized the significance of the partnership with Washington.

“We appreciate the strong collaboration and support of the Trump Administration, Secretary Lutnick and our leading U.S. customers, and have announced an additional $100 billion investment in the U.S., bringing the total planned investment to $265 billion and adding to the largest foreign direct investment in U.S. history,” he said.

The spending is meant to strengthen the domestic chip supply chain and generate well-paying jobs.

Beyond TSMC’s own commitments, the trade agreement is expected to pull in $250 billion from other Taiwanese semiconductor and technology companies, alongside a further $250 billion aimed at relocating more of the global chip supply chain to the United States.

The smartest crypto minds already read our newsletter. Want in? Join them.