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Taiwan Semiconductor Manufacturing (TSM) reported second-quarter earnings Thursday. And while the market appeared to shrug off a very stable earnings report, the company announced its plan to invest another $100 billion in its foundries in Arizona.
The declaration, made during the company’s earnings call with analysts, brings TSMC’s complete investment in Arizona to $265 billion in up to 12 separate services.
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CEO C.C. Wei instructed analysts that the investment would support superior packaging fabs and the manufacturing of 2-nanometer chips, which TSMC just started promoting in the second quarter.
“We believe this investment will help to further foster the development of the United States semiconductor ecosystem, strengthen the supply chain, and support an increasing number of high-tech, high-paying jobs in the United States,” he said. “At the same time, we are building 13 leading-edge and advanced packaging fab in Taiwan over the next several years, and we will continue to further invest in Taiwan. Therefore, TSMC’s semiconductor technology and manufacturing will continue to play a pivotal role in supporting the global semiconductor industry while unleashing our customers’ innovations.”
Let’s take a nearer look at TSMC and discover bullish reasonings about the company for 2026 and beyond.
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TSMC Profits Soar in Q2
TSMC, as the company is identified, is the world’s largest foundry, with the largest half of its business geared toward making high-powered artificial intelligence chips for Nvidia Corporation (NVDA), Advanced Micro Devices (AMD), Broadcom (AVGO), and other chipmakers. TSMC has a market cap of $2.18 trillion, making it the seventh-largest company in the world by market cap.
Revenue in the second quarter was $40.2 billion, up 33.7% from a yr in the past and up 12% on a sequential foundation. Net income was $22.36 billion, up a whopping 77.8% from a yr in the past.
And TSMC expects income growth to speed up through the finish of the yr. The company called for third-quarter income to be in the vary of $44.6 billion and $45.8 billion, which would be up 36% from a yr in the past. And full-year income is expected to grow by 40%, management said.
A key half of that income growth will be from TSMC’s 2 nm processes. Taiwan Semiconductor just began getting income for its 2 nm course of in the second quarter, with industry reports suggesting wafers are about $30,000 each. TSMC disclosed that it obtained 3% of its income from 2 nm gross sales.
TSMC breaks its income by course of technology, and 4 years in the past, wafers from 2 nm and 3 nm applied sciences weren’t even on the market. Nearly two-thirds of TSMC’s income comes at present from 5 nm applied sciences and below.
Process Technology
Q2 2026
Q2 2025
Q2 2024
Q2 2023
2 nm
3%
0%
0%
0%
3 nm
30%
24%
15%
0%
5 nm
33%
36%
35%
30%
7 nm
11%
14%
17%
23%
All Others
23%
23%
33%
47%
Source: TSMC
That’s why TSMC is investing another $100 billion in Arizona. The company first broke ground in the U.S. in 2021, and has been steadily rising its investment as the U.S. authorities has pressured international producers to invest in the U.S. The $100 billion investment announced Thursday would contain building 4 new foundries, becoming a member of six present fabs and two superior chip packaging services in the Phoenix space.
Yet another tailwind is TSMC’s pricing energy. TSMC reportedly has a 73% market share in the world chip market, and executives like Nvidia CEO Jensen Huang have spoken glowingly about the company, saying in 2025, “You can’t overstate the magic that is TSMC.”
Wedbush Securities wrote in an analyst observe this week that TSMC could raise mature-node chip costs early in 2027. Considering the distinctive place that Taiwan Semiconductor holds in the market, its clients would discover it very tough to search an various foundry that they would trust with superior chip manufacturing.
What Are Analysts Saying About TSMC Stock?
Despite the stable earnings report, buyers appeared to shrug off the data, with TSMC stock down 2.32% at Thursday’s COB amid broader sell-offs in the tech sector. Analysts have a rosier view, with 17 specialists who cowl the stock giving it a consensus “Strong Buy” score. Thirteen advocate “Strong Buy,” two facet with a “Moderate Buy,” while the remaining two give “Hold” rankings. The consensus price goal of $463.92 represents potential upside of 13.2%. But a $590 Street-high price goal signifies a potential for a 44% upside for the next 12 months.
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TSMC could hit that upside, particularly as buyers understand that Q3 and This fall income growth will seemingly speed up from an already-solid Q2 report. The company’s 2 nm processes, mixed with its reported plans to increase costs, may bode effectively for future earnings.
On the date of publication, Patrick Sanders had a place in: NVDA. All data and information in this article is solely for informational functions. This article was initially printed on Barchart.com
