Chip stocks rally after TSMC’s strong sales forecast calms growth worries
Taiwan Semiconductor Manufacturing Company has offered something of an antidote to the brief crisis of confidence that hit the chipmaker industry.
Two days after a broad semiconductor-stock sell-off driven by a light forecast from the Dutch firm ASML, chipmakers rallied on Thursday on TSMC’s strong results. TSMC itself climbed as much as 13% in New York trading, while major industry players Nvidia, Broadcom, and Micron each rose roughly 4% at intraday highs.
The iShares Semiconductor ETF also rose as much as 3%.
TSMC’s third-quarter earnings report saw the company increase its 2024 sales-growth forecast to 30%, up from previous projections of mid-20% expansion. The firm also said AI-product revenue would triple this year, making up 15% of the company’s total revenue.
“The demand is real,” CEO C.C. Wei said on the post-earnings conference call. “One of my key customers said, the demand right now is insane. It’s just the beginning.”
The results offer a sigh of relief for an industry that briefly panicked this week after ASML offered a far bleaker demand outlook.
TSMC is now up more than 100% year-to-date, trailing Nvidia’s 182% climb but easily outpacing the iShares Semis ETF (21%) and the benchmark S&P 500 (23%) over the same period.
