Taiwan’s TSMC Earns Record Profits as AI Boom Continues

Taiwanese tech company Taiwan Semiconductor Manufacturing Company, the leading contract chipmaker in the world, has massively benefited from the AI investment frenzy. As a result of the brisk business it has been having, TSMC reported record quarterly earnings for Q3 2025.

Its clients like Apple and Nvidia have been channeling billions of dollars to servers, chips and data center construction. CC Wei, the CEO and chairman of TSMC, says this investment boom remains much stronger than they had predicted in the previous quarter. The company expects demand to remain strong in the coming months and quarters.

While announcing the Q3 revenues of the firm on Thursday, Wei said they had registered a 39.1% surge when they compare this quarter’s earnings to the results of the same quarter last year. The company recorded $14.7 billion as revenue for Q3 2025. This revenue was 30% higher than what was recorded in the previous quarter, and this performance exceeded what had been forecast for the company by analysts.

The earnings report of TSMC comes in the wake of an escalation in the trade war between the U.S. and China. There are concerns that Washington will impose export restrictions targeting China and that chips could also face import tariffs.

China has instituted fresh restrictions on exports of rare earths and it is working to elevate its own semiconductor industry. These moves have caused fear that the AI industry could be caught in the crossfire.

However, Wei is upbeat about the prospects of the company. He says the market will remain positive even if TSMC is denied access to the Chinese market or the clients TSMC serves can no longer access the market in China. He believes growth in the AI industry will remain dramatic despite any restrictions to the Chinese market.

Capital outlays on AI-related projects are skyrocketing across the world. Projections indicate that capex on AI is set to hit $1.5 trillion this year and then grow to $2 trillion next year. That forecast for AI spending next year will give the sector approximately 2% of worldwide GDP.

Analysts say the record revenue generated by TSMC underscores the immense capacity and technology at the company. It will be hard for those capabilities to be replicated in the near-term, industry watchers say.

TSMC has for long deliberately concentrated its production in Taiwan for strategic reasons. The island regards its chips dominance as a shield against any possible attack by China, and as an incentive for the U.S. to protect the island. This is the reason why the island turned down and has been resisting efforts by Washington to get more semiconductor production shifted to American soil.

As the AI race between tech titans like Alphabet Inc. (NASDAQ: GOOGL) (NASDAQ: GOOG) and their rivals heats up, all eyes will be watching how geopolitics impacts this critical industry.

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