Key takeaways
The world's largest contract chipmaker posted net income of NT$505.74 billion for the October-December period, compared to analyst expectations of NT$478.37 billion.
Revenue for the quarter reached NT$1.046 trillion (approximately $33.09 billion), surpassing the forecasted NT$1.034 trillion.
The results demonstrate TSMC's continued dominance in the semiconductor manufacturing industry, particularly in advanced AI processors.
AI demand fuels margin expansion
The company's gross margin for the fourth quarter reached 62.3%, significantly higher than the expected 60.6%.
Operating profit came in at NT$564.9 billion, beating estimates of NT$527.23 billion, while the operating margin stood at 54%, above the forecasted 50.9%.
TSMC's performance has been bolstered by full utilization of its 3-nanometer manufacturing capacity, driven by demand for AI chips and high-end smartphone processors.
The company manufactures advanced chips for major technology companies, including Nvidia and Apple, which together likely account for over 40% of TSMC's revenue.
Strong momentum continues into 2026
For the full year 2025, TSMC reported consolidated revenue of NT$3.81 trillion, representing a 31.6% increase from the previous year's NT$2.89 trillion.
The company's capital expenditure for 2025 totaled $40.9 billion, reflecting significant investments in expanding manufacturing capacity.
TSMC's stock performance has mirrored its operational success, with shares gaining 44.2% over the past year in Taipei trading, substantially outperforming the broader market's 25.7% rise.
The company's market capitalization has reached approximately $1.4 trillion, making it Asia's most valuable listed company and more than double that of South Korean rival Samsung Electronics.
Industry outlook remains positive
Research firm IDC expects TSMC's revenue to grow between 25% and 30% in 2026, citing booming demand for AI server accelerators and significant contributions from the company's next-generation 2-nanometer node technology.
The chipmaker is also investing $165 billion to build manufacturing facilities in Arizona, further expanding its global footprint.
The earnings call, held Thursday at 1:00 a.m. Eastern Time, provided investors with updated guidance for the first quarter of 2026 and the full year ahead.
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