TSMC Posts Record Q4 Profit, Signals 2026 Capex Surge to Power AI Buildout

TAIPEI — Taiwan Semiconductor Manufacturing Co. (TSMC) on Thursday reported record quarterly profit and outlined an aggressive investment roadmap for 2026, reinforcing investor confidence that the global AI infrastructure cycle remains intact.

The world’s largest contract chipmaker posted a 35% jump in fourth-quarter net profit to T$505.74 billion, beating analyst expectations as demand stayed strong for advanced semiconductor manufacturing used in high-end smartphones and AI servers.

TSMC’s performance reflects continued strength in the global push to expand compute capacity, with major customers across consumer electronics, cloud infrastructure and AI accelerators relying on the company’s leading-edge manufacturing.

Executing the $165 billion U.S. roadmap

During the earnings briefing, CEO C.C. Wei confirmed TSMC has entered the permitting phase for a fourth fabrication plant in Arizona, part of a broader $165 billion U.S. investment plan first outlined in 2025.

The company also highlighted the increasing role of U.S.-based production in advanced supply chains, including plans to expand capabilities beyond wafer fabrication.

TSMC noted that its Arizona footprint is expected to include advanced packaging capacity — an important step for AI chips, where performance increasingly depends not only on transistor scaling but also on how chips are integrated and packaged.

2026 capex: a high-conviction bet on AI

TSMC raised its 2026 capital expenditure (capex) outlook to $52 billion to $56 billion, signalling a sharp step-up in spending as the company expands capacity and prepares for the next generation of chip manufacturing technology.

Management forecast 2026 revenue growth of 25% to 30% in U.S. dollar terms, led by continued demand tied to AI infrastructure buildouts and the ramp-up of next-generation process technologies.

Widening gap at the high end

The results underscore the widening gap in advanced logic manufacturing, where TSMC continues to hold a dominant position globally. Its scale, technology lead, and customer concentration at the cutting edge have made it a key beneficiary of the AI-driven semiconductor cycle.

FAQs

1) What drove TSMC’s record quarterly profit?

TSMC benefited from strong demand for advanced semiconductor manufacturing, particularly from customers serving AI infrastructure, cloud computing and premium consumer devices.

2) What is the status of TSMC’s Arizona expansion?

TSMC confirmed it has moved into the permitting phase for a fourth Arizona fab as part of a long-term plan to scale its U.S. manufacturing footprint.

3) Why is TSMC’s 2026 capex guidance so high?

TSMC is expanding capacity and investing in next-generation manufacturing and packaging technologies to support long-term demand, including AI-related computing infrastructure.

4) Is there a risk of oversupply?

Some analysts have raised concerns about cyclicality, but TSMC has consistently stated that capacity expansion is aligned with long-term customer commitments.