TSMC Surpasses All Expectations in the Second Quarter: Record Profit Up 77% Thanks to AI Boom

TSMC has concluded the second quarter of 2026 with results exceeding analysts' expectations, once again confirming itself as the beating heart of the revolution called artificial intelligence. Data for the month of June, released in recent days, had hinted that the Taiwanese company would publish remarkable quarterly results.

The world's leading producer of contract chips registered a net profit of NT$706.56 billion (approximately $40.2 billion in revenue), representing a growth of 77.4% compared to the same period last year and 23.4% compared to the previous quarter. This marks the fifth consecutive quarter in which TSMC sets a new net profit record.

The revenues also reached an all-time high, standing at NT$1,270.38 billion, up 36% year-on-year and 12% compared to the first quarter of 2026. The figure slightly surpassed market expectations, which estimated revenue at about NT$1,264 billion. The net profit performed even better, exceeding analysts' consensus by a wide margin.

Growth continues to be driven by strong demand for advanced semiconductors used in infrastructure dedicated to artificial intelligence. TSMC produces chips designed by companies like NVIDIA, Apple, and Broadcom, which continue to increase orders to support the expansion of AI datacenters and accelerated computing platforms.

The data also highlight an improvement in profitability. For the quarter, the gross margin reached 67.7%, while the operating margin stood at 60.3%. The net margin rose to 55.6%, values that confirm the company's ability to maintain high profitability despite the significant investments required by more advanced production processes.

From a technological perspective, the production mix continues to shift toward more sophisticated lithographies. The 3-nanometer processes accounted for 30% of revenue from wafer production, while the 5-nanometer ones contributed 33%. The 7-nanometer process still makes up 11%, while the new 2-nanometer process, which has entered the initial production phase, has already generated 3% of wafer-related revenue. Overall, all technologies at 7 nanometers and below accounted for 77% of wafer division revenues, confirming how TSMC's business is now heavily concentrated on the most advanced production technologies.

TSMC's financial strength also emerges in other balance sheet items. At the end of June, TSMC had cash and liquid securities exceeding NT$3,518 billion, while net equity reached NT$6,474 billion. In the quarter, the operating cash flow was equal to NT$783 billion, allowing the company to support capital investments of NT$496 billion without compromising a free cash flow generation exceeding NT$287 billion.