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TSM Reports Record Profits, Lifts Forecast — But Stays Cautious

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is one of the AI Stocks Gaining Attention on Wall StreetOn July 15, Reuters reported that TSMC is anticipated to post a 52% jump in second-quarter profit, reaching record levels. However, U.S. tariffs and a strong Taiwan dollar could weigh on its outlook.

Mario Morales, group vice president at research firm IDC, noted that AI-related demand and the growing foundry industry revenue may lead to TSMC’s sales growing by nearly 30%.

The contract chipmaker and key supplier to Nvidia and Apple was anticipated to report net profit of T$377.4 billion ($12.9 billion) for the three months through June 30, as per an LSEG SmartEstimate compiled from 21 analysts.

Subsequently, the company posted a nearly 61% year-on-year rise in second-quarter profit, hitting a record high of NT$398.27 billion, and surpassing estimates on the back of resilient demand for AI chips. The contract chip manufacturer guided third-quarter revenue between $31.8 billion and $33.0 billion, which is a 38% year-over-year increase.

A stock broker on a trading floor, working to capture profit in the markets.

According to TSMC CEO C.C. Wei, TSM anticipates its full-year 2025 revenue to rise by around 30% in U.S. dollar terms artificial intelligence growth and demand for its artificial intelligence technologies.

“The primary driver of growth for TSMC has been the robust demand for AI-related chips, particularly for the leading edge nodes below 7nm.”

-Brady Wang, associate director at Counterpoint Research.

However, potential headwinds from the trade policy of U.S. President Donald Trump, who has threatened steep “reciprocal tariffs” on Taiwan, are still a reality.

“Looking into second half of 2025 we have not seen any change in our customers behavior so far. However, we understand there are uncertainties and risk from the potential impact of tariff policies,” Wei said on Thursday.

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) manufactures and sells advanced chips used in artificial intelligence applications.

While we acknowledge the risk and potential of TSM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TSM and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 10 Trending AI Stocks on Wall Street and 10 Must-Watch AI Stocks on Wall Street.

Disclosure: None.

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When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

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