Taiwan Semiconductor Manufacturing Co. posted its highest quarterly profit ever on Oct. 15, 2026. Revenue hit $46.72 billion, up 50.9 percent from a year earlier. Net income rose 68.7 percent to $23.59 billion. Chairman and CEO C.C. Wei told investors TSMC keeps trailing its own order book. "The demand actually is still far above our capability today to supply," he said on the earnings call. "We are working very hard to narrow the gap"13.
Where the money came from
TSMC's monthly reports had already pointed to a record. August revenue hit NT$514.8 billion, up 53.3 percent from a year earlier. TSMC credited "robust demand linked to artificial intelligence (AI) and new smartphone launches"7. September then set its own monthly record, NT$511.86 billion, pushing the full quarter past TSMC's own guidance range before the call even started8.
Revenue has climbed every quarter since 2024. TSMC made $18.87 billion in the first quarter of that year, $20.82 billion in the second and $23.50 billion in the third. By the fourth quarter it reached $26.88 billion5.
Growth kept building through 2025. Quarterly revenue ran $25.53 billion, $30.07 billion, $33.10 billion and $33.73 billion across that year's four quarters. This year it jumped again: $35.90 billion in the first quarter, $40.20 billion in the second, and $46.72 billion in the third16.
TSMC's quarterly revenue grows 148 percent in eleven quarters, to $46.72 billion
TSMC's consolidated quarterly revenue, first quarter 2024 through third quarter 2026, in billions of U.S. dollars
Each dot is one quarter's revenue; the line rises every quarter, and the last dot is the third-quarter 2026 record.
Sources: Taiwan Semiconductor Manufacturing Company (SEC Form 6-K) [1]; Taiwan Semiconductor Manufacturing Company (SEC Form 6-K) [5]; Taiwan Semiconductor Manufacturing Company (SEC Form 6-K) [6]. Chart by The AILately.com Desk.
The numbers behind this chart
| Period | Value |
|---|---|
| Q1 '24 | $18.87B |
| Q2 '24 | $20.82B |
| Q3 '24 | $23.50B |
| Q4 '24 | $26.88B |
| Q1 '25 | $25.53B |
| Q2 '25 | $30.07B |
| Q3 '25 | $33.10B |
| Q4 '25 | $33.73B |
| Q1 '26 | $35.90B |
| Q2 '26 | $40.20B |
| Q3 '26 | $46.72B |
High-performance computing chips drove the latest jump. HPC revenue made up 68 percent of the quarter's sales, up from 57 percent a year earlier, Chief Financial Officer Wendell Huang said26. That category covers the AI accelerators that firms such as Nvidia design and TSMC builds.
High-performance computing chips make up 68 percent of TSMC's revenue
Share of TSMC's third-quarter 2026 revenue from HPC platform chips, up from 57 percent a year earlier
The 57 percent figure is TSMC's own third-quarter 2025 HPC share, reported a year earlier under the same definition.
Sources: Taiwan Semiconductor Manufacturing Company [2]; Taiwan Semiconductor Manufacturing Company (SEC Form 6-K) [6]. Chart by The AILately.com Desk.
The numbers behind this chart
| Item | Value |
|---|---|
| HPC platform chips | 68 |
| Whole | 100 |
Advanced chips carried most of the load. Nodes at 7 nanometers or smaller made up 79 percent of wafer revenue. Inside that group, 3-nanometer chips supplied 33 percent and 5-nanometer chips supplied 28 percent. The newest 2-nanometer process, barely a year old, already supplied 8 percent, and TSMC expects that share to keep climbing. "Moving into fourth 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," Huang said2.
TSMC expects the growth to continue. It guided to fourth-quarter revenue of $52.3 billion to $54.3 billion, with gross margin between 65 and 67 percent. The midpoint of that range is about 58 percent above last year's fourth quarter. That pace nearly matches this quarter's own 50.9 percent gain1.
Who pays, and who gets paid
TSMC's own filing answers the column's question directly, though it hides the names. The company calls its two biggest customers Customer A and Customer B10.
Nvidia is Customer A, and its own CEO said so. Jensen Huang made the point on a podcast in January, after the interviewer asked about an old conversation with TSMC founder Morris Chang. "By the way, Morris will be happy to know Nvidia is TSMC's largest customer now," Huang said11.
TSMC's own annual report backs him up. Customer A bought NT$726.97 billion of chips in 2025, 19 percent of revenue. Apple, reported widely as Customer B, bought NT$645.18 billion, or 17 percent910.
Together those two customers bought 36 percent of everything TSMC sold in 2025. The ten largest customers combined bought 78 percent, leaving 22 percent spread across more than 500 smaller accounts10.
Nvidia, Apple and a short list of large cloud buyers pay TSMC, and TSMC pays its own shareholders and builders. Shareholders collected a record $23.59 billion in net income1. Builders and equipment makers collected $13.8 billion in new capacity spending this quarter alone. That spending sits inside a 2026 budget of $60 billion to $64 billion1.
The case for: demand outruns supply
Wei gave the same answer to every question about risk on the call. Demand beats supply, he said, and TSMC keeps racing to close the gap between them.
"The demand actually is still far above our capability today to supply," Wei told analysts. "We are working very hard to narrow the gap"3.
TSMC is putting money behind that claim. It plans $60 billion to $64 billion in 2026 capital spending. Spending from 2026 through 2028, the company told investors, will run well above the past three years combined3.
When Citigroup analyst Laura Chen asked whether chip supply might outgrow real AI use, Wei held his ground. "We have a very sophisticated capacity planning process, and we also have a very disciplined on our consideration," he said. He weighed customer roadmaps, cloud spending plans and power supply limits first. Even then, he added, TSMC still judges "the demand is higher than the supply"4.
The case against: two buyers, one bet
Investors reacted to the beat by selling. TSMC shares closed the regular session at $430, down 3.4 percent from the prior close. They fell another 1.98 percent in after-hours trading, to $421.494. A record quarter that still drops the stock price is its own kind of data point for anyone pricing the risk.
Chen's question carried its own warning. She pressed Wei on what happens if chipmaking capacity grows faster than the AI systems it is meant to serve.
"If these kind of trends create a mismatch between semiconductor supply and also actual AI development, how would TSMC adjust your capa- minimize the potential overbuilding in the supply chain?" Chen asked4.
TSMC's own annual report states the risk in plainer language. The concentration, the filing says, "exposes TSMC to changes in ordering patterns, business models or regulatory constraints affecting a small number of major customers"10.
That risk already shows up in the numbers. Apple's share of TSMC's revenue slid from 22 percent in 2024 to 17 percent in 2025, even as its dollar spending ticked up. A supplier that large can still shrink as a share of TSMC's business while AI buyers grow around it910.
Overseas expansion adds its own drag on price. Huang said gross margin dilution from fabs outside Taiwan, mostly in Arizona, runs close to 2 percentage points today. He expects that drag to widen to 3 or 4 points within a few years. For now, revenue growth is covering the gap3.
The case for needs AI demand to keep outrunning new capacity, the way it has for three straight years. Its opposite needs one of TSMC's two biggest customers to pull back orders. It could also come true if new capacity from rivals caps what TSMC can charge. TSMC prints evidence for both every quarter.
By the numbers
- Revenue: $46.72 billion in the third quarter, a gain of 50.9 percent from a year earlier1.
- Net income: $23.59 billion, a jump of 68.7 percent from a year earlier1.
- Margins: 66.4 gross, 58.7 operating and 51.1 net, each measured in percent of revenue1.
- HPC's share of revenue: 68 percent, climbing from 57 a year earlier26.
- Capital spending: $13.8 billion this quarter, inside a 2026 budget of $60 billion to $64 billion1.
- Concentration: TSMC's ten largest customers bought 78 cents of every revenue dollar in 202510.
- Two names: Nvidia and Apple alone bought 36 cents of that same dollar910.
- Guidance: $52.3 billion to $54.3 billion is the range TSMC expects for the fourth quarter1.
What to watch
Watch TSMC's January 2027 report against its own $52.3 billion to $54.3 billion range for the fourth quarter. A clean beat would back Wei's demand math for one more quarter. Watch Nvidia's own earnings too. A slowdown in its data center orders would show up inside TSMC's HPC line before it shows up anywhere else. The overseas margin dilution Huang flagged is a third gauge. A jump past his 3-to-4-point range would say the Arizona buildout costs more than planned. Either report will move the needle on Chen's question, long before a crash would.
Sources
- Taiwan Semiconductor Manufacturing Company, "TSMC Reports Third Quarter EPS of NT$29.43," SEC Form 6-K, Oct. 15, 2026, https://pr.tsmc.com/english/news/3346
- Wendell Huang, quoted in "TSMC Reports Third Quarter EPS of NT$29.43," Taiwan Semiconductor Manufacturing Company, Oct. 15, 2026, https://pr.tsmc.com/english/news/3346
- The Motley Fool Transcribing, "TSMC (TSM) Q3 2026 Earnings Call Transcript," The Motley Fool, Oct. 15, 2026, https://www.fool.com/earnings/call-transcripts/2026/10/15/tsmc-tsm-q3-2026-earnings-call-transcript/
- Investing.com, "Earnings call transcript: TSMC beats Q3 2026 estimates as stock slips," Investing.com, Oct. 15, 2026, https://www.investing.com/news/transcripts/earnings-call-transcript-tsmc-beats-q3-2026-estimates-as-stock-slips-93CH-4950695
- Taiwan Semiconductor Manufacturing Company, "Form 6-K, First Quarter 2024 Earnings Release," SEC, Apr. 18, 2024, https://www.sec.gov/Archives/edgar/data/1046179/000104617924000046/a1q24e_withguidancexfinal.htm
- Taiwan Semiconductor Manufacturing Company, "Form 6-K, Third Quarter 2025 Earnings Release," SEC, Oct. 16, 2025, https://www.sec.gov/Archives/edgar/data/1046179/000104617925000116/a3q25e_withguidancexfinal.htm
- Chang Chien-chung and Evelyn Kao, "TSMC posts record monthly revenue for August on strong AI demand," Focus Taiwan, Sept. 10, 2026, https://focustaiwan.tw/business/202609100014
- Keoni Everington, "TSMC posts record September revenue as Q3 sales hit new high," Taiwan News, Oct. 8, 2026, https://www.taiwannews.com.tw/news/6454456
- Matthew Strong, "Nvidia overtakes Apple to become TSMC's largest client," Taiwan News, Feb. 27, 2026, https://www.taiwannews.com.tw/news/6310676
- StockTitan, "TSMC details 2025 growth and global expansion," StockTitan, Apr. 16, 2026, https://www.stocktitan.net/sec-filings/TSM/20-f-taiwan-semiconductor-manufacturing-co-ltd-files-annual-report-fo-e7792df70159.html
- Jowi Morales, "Jensen Huang says Nvidia has dethroned Apple as TSMC's largest customer," Yahoo Finance, Jan. 21, 2026, https://finance.yahoo.com/news/jensen-huang-says-nvidia-dethroned-155453264.html