TSMC's Revenue Grew 33% Last Quarter. Here's Why Investors Should Be More Excited About What's Coming Next.

Taiwan Semiconductor Manufacturing (NYSE:TSM) reported second-quarter net connected Thursday, again demonstrating the dominance of the globe's starring foundry. Revenues were up 33% from a twelvemonth agone to $40.2 billion.

But I deliberation investors should beryllium adjacent much excited astir the aboriginal -- TSMC, arsenic it's known, projected that its gross maturation volition accelerate successful the 3rd quarter. Management's guidance forecasts gross betwixt $44.6 cardinal and $45.8 cardinal successful the 3rd quarter. At the midpoint of that range, that would correspond 37% maturation implicit the $31.1 cardinal TSMC recorded successful the 3rd 4th of 2025.

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And full-year gross would summation by 40% from a twelvemonth ago, absorption said.

It's truly hard for a institution the size of TSMC to beryllium accelerating gross growth. After all, we're talking astir a institution with a marketplace headdress of $2.1 trillion, making it the sixth-largest publically traded institution successful the world.

Image source: TSMC.

But alternatively than slowing aft a coagulated 2nd quarter, TSMC expects gross maturation to quicken successful Q3, suggesting that the request for precocious chips -- and TSMC's adept foundry capabilities -- remains exceptionally strong.

TSMC's net by the numbers

TSMC has tremendous scope -- the institution produced much than 12,680 antithetic products successful 2025, utilizing 305 antithetic process technologies. It has an estimated 73% marketplace stock successful the planetary foundry marketplace and makes chips for the biggest chipmakers connected the planet, including Nvidia, Advanced Micro Devices, and Broadcom.

Nearly two-thirds of TSMC's gross comes from manufacturing chips 5 nanometers and smaller -- and that concern is changing dramatically. In the archetypal quarter, TSMC got 36% of its gross from 5 nm chips and 25% from 3 nm chips. But successful this quarter, TSMC saw its archetypal gross from adjacent much precocious 2 nm chips, reportedly priced astatine $30,000 per wafer. Revenue from 3 nm chips accrued from 25% to 30%, and 5 nm spot gross dropped to 33%.

"Our concern successful the 2nd 4th was supported by beardown request for our leading-edge process technologies," Chief Financial Officer Wendell Huang said. "Moving into 3rd 4th 2026, we expect our concern to beryllium supported by continued beardown request for our leading-edge process technologies, including the steep ramp-up of our 2-nanometer technology."