TSMC’s sales grow slowest in months even as AI buildout persists

[TAIPEI] Taiwan Semiconductor Manufacturing (TSMC) posted its slowest pace of monthly revenue expansion since October, highlighting the potential challenges of sustaining a torrid artificial intelligence-fuelled pace of growth.

Sales in April rose 17.5 per cent to NT$410.7 billion (S$16.6 billion), their smallest rise in about six months.

While the increase reflects just 30 days of business and its monthly revenue can fluctuate, analysts on average expect the company’s June-quarter revenue to grow almost twice as fast, or at about 35 per cent. 

Taiwan’s largest company has become an essential player in the global AI industry by making cutting-edge semiconductors for the likes of Nvidia and Advanced Micro Devices.

Meanwhile, Alphabet, Amazon.com, Meta Platforms and Microsoft have said they are setting aside US$725 billion for AI in 2026, significantly more than previously anticipated.

The company, however, is exposed to a plateauing smartphone and consumer-electronics market, in which soaring memory-chip costs are forcing brands to hike prices.

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Economic uncertainty is also dampening consumer demand in many parts of the world.

TSMC has remained bullish on global AI chip demand.

In April, it raised its full-year sales guidance and said its capital spending should trend towards the upper end of an existing forecast range of as much as US$56 billion, conveying confidence in the year’s economic outlook. BLOOMBERG