TSMC (TSM) Stock Slips Despite Strong AI Chip Demand and Robust Revenue Growth
Taiwan Semiconductor Manufacturing Company's stock failed to extend its previous long bullish rally and turned bearish arund $420.39 level..
Quick overview
- TSMC's stock turned bearish around $420.39 after a long bullish rally, showing modest losses of 0.28 percent.
- Despite the dip, TSMC has gained around 33 percent since the start of the year, driven by strong demand for AI chips.
- The company's preliminary revenue report for Q2 2026 revealed $39.62 billion in sales, a 36 percent increase from last year, with AI chips contributing 61 percent of total sales.
- Investors are anticipating the full earnings report on July 16, 2026, which is expected to show strong profit growth and continued sales growth of over 30 percent for the year.
Taiwan Semiconductor Manufacturing Company’s stock failed to extend its previous long bullish rally and turned bearish arund $420.39 level in the European trading session on Wednesday. At the time we are writing this article, TSMC (NYSE: TSM) is showing modest losses of 0.28 percent, but that is not something investors seem too worried about.
TSMC has already gained around 33 percent since the start of the year, so this small dip is unlikely to change the company’s strong outlook or investor confidence.
However, the reason for its strong upward trend can be attributed to the strong demand for AI chips. Many big technology companies like Nvidia, AMD, and Apple need powerful chips to run artificial intelligence systems, which are used in smart tools, data centers, and new computers.
TSMC makes exactly these advanced chips better and faster than most other companies, which was seen as one of the key factor behind this company’s growth.
TSMC Earnings Show Strong Business Growth
Moreover, the companys good performance was also proved by its strong preliminary revenue report for the second quarter of 2026, which was from April to June. In it, it is revealed that the company made $39.62 billion in sales, which was 36 percent higher compared to last year.
During the month of June alone, sales increased by 67.9 percent to NT$442.68 billion. During the first half of the year, total sales were close to $75 billion, which was 35.6 percent higher.
However, the biggest contribution to the revenue came from the AI chips business, which makes up almost 61 percent of the companys total sales. The reason for all of this is that major customers such as Nvidia, AMD, and Apple are buying a huge number of chips, because of which the factories are running at full capacity.
Looking forward, investors are keeping their eyes on the Quarter 2 full earning report which is scheduled to be released on July 16, 2026. It is expected to show sales of around 39.6 billion US dollars with strong profit growth of nearly 58%.
The company expects that in the full year 2026, sales will grow by more than 30 percent. This is mainly due to continued AI demand. TSMC is also building new factories in USA, Japan and other places to reduce risks.
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