TSMC keeps the AI train on track; beats on Q3 EPS and hikes 2025 sales growth outlook to ~35%, up from ~30%

TSMC is rising in early trading on Thursday after the Taiwanese chipmaker posted another record quarterly profit and raised its outlook for the rest of the year.

The world’s largest contract chipmaker saw its net profit rise 39% to 452.3 billion New Taiwan dollars (about US$14.8 billion) from a year earlier, with diluted earnings per share also increasing 39% to NT$17.44 for the third quarter ended September 30 — roughly 10% ahead of Wall Street’s estimates compiled by Bloomberg.

In TSMC’s earnings release, Chief Financial Officer Wendell Huang said, “Moving into fourth quarter 2025, we expect our business to be supported by continued strong demand for our leading-edge process technologies.”

Indeed, while the Q3 numbers were solid, the company’s revised guidance might have perked up investors the most. TSMC now expects Q4 2025 revenue to be between US$32.2 billion and US$33.4 billion, and sales growth in the mid-30% range for the full year, up from “about” 30% in July.

TSMC’s shares have soared nearly 40% this year as demand for high-performance semiconductors, crucial in the race to build out the AI data center infrastructure necessary for large language models, continues to grow. Per Bloomberg, the company’s CEO said that “AI demand actually continues to be very strong, stronger than we thought three months ago.”

The bullish outlook in the face of a rapidly shifting geopolitical environment was noteworthy, too. While company executives downplayed the impact on its overall business, trade policy is complicating the chip supply chain: Taiwan is still negotiating its 20% tariff on US-bound goods, Beijing is restricting the supply of rare earth minerals, and the US-China tussle over the flow of advanced AI chips continues.