TSMC (TSM.US) earnings, as a key player in the global semiconductor market, showed that AI is allowing some companies to earn a fortune.
Optimism surrounding AI infrastructure and companies tied to the trend has eased uncertainty over U.S.–China trade relations. Today’s very strong TSMC report aligns well with yesterday’s results from ASML — a company crucial for AI infrastructure through its EUV lithography machines — which also beat expectations.
As a result, Nasdaq 100 futures (US100) are trading 0.4% higher, breaking clearly above 25,000 points.
In pre-market trading, shares of AI infrastructure-related companies such as Broadcom, Nvidia, AMD, and Arista Networks are also gaining.
Investors still lack details about the ongoing Washington–Beijing negotiations, and it appears that reaching any potential agreement may take longer. The market views the outcome as uncertain but is not pricing in additional risk today. Moreover, it remains unclear whether a final deal would be escalatory, or if both sides could reach a diplomatic compromise involving mutual concessions.
China’s Ministry of Commerce commented today on U.S. electric vehicle subsidies, stating that discrimination against Chinese goods violates WTO rules. Meanwhile, the prospect of a meeting between Trump and Xi has resurfaced, leaving markets hopeful for a positive outcome to U.S.–China negotiations.
TSMC Results
- Revenue: NT$989.92 billion (+30% y/y; expected NT$967.7 billion)
- Net profit: NT$452.3 billion (+39% y/y; expected NT$405.5 billion)
- Gross margin: 59.5% (Q2: 58.6%; expected 57.1%)
- Revenue outlook for 2026: ~30% y/y growth at the midpoint (previously ~30% y/y) → USD 117.4–121.9 billion (expected USD 120.6 billion)
US100 Chart
The Nasdaq 100 futures contract is currently trading about 300 points below its all-time high, and — similar to late August — it has held above the 50-day EMA (orange line).
Source: xStation5
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