TSMC revenue hits all-time high as AZ factory production ramps up
Taiwan Semiconductor Manufacturing Co. reported record-breaking quarterly revenue on Monday that topped Wall Street expectations as the global contract chipmaker continues to capitalize on surging AI-related demand.
Ahead of its second quarterly earnings release on July 16, TSMC (NYSE: TSM) said it posted Q2 revenue of $39.6 billion, marking a 36% increase over the prior year quarter and topping the $39.3 billion Wall Street analyst revenue consensus. TSMC’s second quarter revenue was on the high end of the company’s projected quarterly guidance between $39 billion and $40.2 billion.
The company’s Q2 sales figure also exceeded its previous quarterly revenue record of $35.8 billion set in the first quarter, driven by demand for artificial intelligence applications and high-performance computing chips.
Sravan Kundojjala, an analyst at SemiAnalysis, told CNBC that TSMC’s quarterly financial figures are “quite robust” as the company’s June revenue has historically declined month-over-month for the past four years.
“The demand supply situation in AI is still quite tight and TSMC is sold out on N3, which is targeted by all leading AI GPU and CPUs this year,” he told CNBC, referring to TSMC’s advanced manufacturing process used to build chips for smartphones, data centers, AI and high-performance computing applications.
For the first half of 2026, TSMC’s total revenue reached $74.9 billion, representing a 35.6% increase over the same period in 2025. The company also reported June revenue of $13.2 billion, a 67.9% increase from June 2025, according to a regulatory filing.
TSMC’s stock closed at $421.58 a share on Monday, down 2.8%.
TSMC gears up to start production at second AZ chip factory
TSMC’s revenue milestone comes just a few months after CEO C.C. Wei said the company is increasing its annual capital expenditures from $52 billion to $56 billion to boost its N3 capacity and support a multiyear pipeline of demand for 3 nanometer chips.
Wei said during TSMC’s April 16 earnings call that the company’s second Arizona semiconductor factory, or fab, will produce 3-nanometer chips. Construction is already complete on the building and volume production slated for the second half of 2027.
TSMC has already gained significant experience operating in Arizona and is “moving aggressively forward” to accelerate development of its north Phoenix fab site, Wei said.
TSMC completed its first fab that started high-volume production of N4 technology chips in late 2024. In addition to completing construction of its second fab ahead of schedule, TSMC broke ground on its third fab in mid-2025, paving the way to begin 3-nanometer chip production by 2027, which is a year earlier than expected, the Business Journal previously reported.
Under the company’s current $165 billion investment, TSMC would build out a total of six chip fabs, two chip packaging facilities and an R&D center in a construction timeline that already extends beyond 2030.
Last month, TSMC finalized a 10-year agreement with Amkor Technology Inc., establishing a structured approach for the company to receive advanced packaging and test services from Amkor, along with coordinated capacity expansion and planning, the Business Journal previously reported. The partnership builds on a memorandum of understanding that the two companies entered into in 2024.
In addition to its Arizona expansion, TSMC plans to add two advanced chip packaging plants in the Chiayi Science Park in southern Taiwan, Reuters reported, citing remarks made on Sunday by Taiwan’s National Science and Technology Council Minister Wu Cheng-wen.
Wu noted that the site’s first facility is already in mass production, with the second expected to begin shortly, according to Reuters.