TLDR
- TSMC reported October revenue of $11.86 billion, representing 16.9% year-over-year growth but the slowest pace in nearly two years
- The growth rate dropped substantially from September’s 31.4% increase, raising questions about the durability of AI chip demand
- Cumulative revenue from January through October totaled $3.13 trillion, climbing 33.8% compared to the same timeframe in 2024
- Nvidia CEO Jensen Huang asked TSMC for additional chip production capacity, stating business momentum remains strong
- TSMC shares rose nearly 3% in premarket trading while the broader tech sector faces valuation concerns
Taiwan Semiconductor Manufacturing reported October revenue of NT$367.47 billion, equivalent to roughly $11.86 billion. The figure marks a 16.9% jump compared to October 2024.
Taiwan Semiconductor Manufacturing Company Limited, TSM
The growth represents a sharp slowdown from September’s 31.4% year-over-year increase. Data from Bloomberg shows this is the chipmaker’s weakest annual growth rate since February 2024.
On a sequential basis, revenue increased 11% from September. TSMC’s cumulative sales from January through October reached NT$3.13 trillion, up 33.8% versus the prior year period.
The Taiwan-based manufacturer supplies advanced chips to Nvidia and other technology companies building AI infrastructure. This positioning has driven the company’s valuation higher over the past three years.
Demand Signals Remain Mixed
Nvidia CEO Jensen Huang made an appearance at TSMC’s annual sports day celebration. He disclosed that he had asked the chipmaker to increase production volumes.
“The business is very strong, and it’s growing month by month, stronger and stronger,” Huang said at the gathering. TSMC CEO C.C. Wei confirmed the production request when speaking with reporters.
The statements from both executives suggest AI chip orders continue flowing in. Companies across industries are expanding data center capacity to support machine learning applications.
TSMC previously issued fourth-quarter revenue guidance ranging from $32.2 billion to $33.4 billion. The midpoint of that forecast indicates approximately 22% annual growth for the three-month period.
Tech Stocks Face Pressure
TSMC stock gained nearly 3% during Monday’s premarket session. Nvidia shares also advanced more than 3% in early trading.
The positive movement follows a difficult stretch for technology equities. The Nasdaq Composite dropped 3% last week, marking its steepest weekly decline since early April.
Wall Street analysts and investors have begun questioning whether AI-related valuations can hold up. Goldman Sachs CEO David Solomon commented at a Hong Kong financial summit that “technology multiples are full.”
Prominent short seller Michael Burry recently established bearish positions in Nvidia and Palantir. His bets against two major AI stocks have amplified market chatter about overvaluation risks.
Investor Sentiment Shifts Lower
The contrast between Nvidia’s production requests and TSMC’s slower growth has created uncertainty. Bulls emphasize continued demand from key customers and strong year-to-date performance.
Bears focus on the month-over-month deceleration from 31.4% to 16.9% as a warning sign. They argue the slowdown could indicate peak AI spending is approaching.
TSMC continues supplying chips for global data center expansion projects. The October revenue data confirms ongoing demand even as the pace of growth moderates from recent highs.
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