TSMC Posts Results, Invests $100B More In Arizona
TSMC posted strong results in the second quarter and raised its capital spending plans in 2026
By Mark LaPedus
TSMC posted strong results in the second quarter and raised its capital spending plans in 2026.
In addition, Taiwan’s TSMC, the world’s largest foundry vendor, also announced an additional $100 billion investment at its Arizona fab cluster. This brings the company’s total investment in Arizona to $265 billion, according to TD Cowen.
Meanwhile, TSMC reported second quarter revenue of US$40.20 billion, up 33.7% year-over-year and up 12.0% from the previous quarter. Net income was US$22.366 billion during the quarter, up 77.8% year-over-year and up 23.4% from the previous quarter.
The company’s growth was driven by AI and other technologies. TSMC manufactures AI chips for several foundry customers, such as AMD, Broadcom, Nvidia and many others. These AI chip vendors are experiencing enormous demand for their respective AI chip offerings in the market.
TSMC’s sales were also driven by its leading-edge processes, including its new 2nm technology, which moved into production late last year. “Our business in the second quarter was supported by strong demand for our leading-edge process technologies,” said Wendell Huang, senior vice president and chief financial officer of TSMC. “Moving into third quarter 2026, we expect our business to be supported by continued strong demand for our leading-edge process technologies, including the steep ramp-up of our 2-nanometer technology.”
In the second quarter, shipments of 2nm accounted for 3% of the company’s total wafer revenue; 3nm accounted for 30%; 5nm accounted for 33%; and 7nm accounted for 11%. Advanced technologies, defined as 7nm and below, accounted for 77% of total wafer revenue.
By platform, high-performance computing (HPC) and smartphone represented 66% and 22% of TSMC’s net revenue in the quarter, respectively. IoT, automotive, digital consumer electronics (DCE), and others each represented 5%, 4%, 1%, and 2%, respectively.
Going forward, TSMC’s third quarter sales are expected to be between US$44.6 billion and US$45.8 billion.
Here are some of the other noteworthy data points at TSMC:
*Driven by strong demand for AI chips, TSMC raised its 2026 revenue outlook. Now, the company projects over 40% year-over-year growth in 2026. This equates to $171.4 billion-plus in terms of sales in 2026, which is above the consensus view of $164.6 billion, according to TD Cowen.
*“Owing to strong structural demand for 5G, AI, and HPC semis, TSMC also raised its CY26 capex view to $60 billion to $64 billion,” said Krish Sankar, an analyst at TD Cowen, in a research note. Previously, TSMC’s 2026 capital spending budget was between US$52 billion and US$56 billion.
*Today, TSMC is ramping up its first fab in Arizona, which is producing 4nm chips. The company is also building three more fabs, as well as a packaging plant in Arizona. TSMC continues to invest in Arizona. “TSMC also announced an additional $100B investment at its Arizona fab cluster that entails 4+ fabs (front-end wafer and advanced packaging). This brings its long- term investment goal in Arizona to $265B. We believe this incremental commitment could be in response to competitive risks represented by new leading-edge foundry investments by Terafab (Intel a technology partner) and Samsung Foundry,” Sankar said.
*TSMC is adding fab capacity to meet stronger-than-expected demand for its older 3nm processes. “TSMC is increasing 3nm capacity through Fab 18, Arizona, possible Japan fab for 3nm and converting some 28nm to 3nm in Taiwan (Fab 15),” Sankar added.