AI chip demand ‘outpacing supply’ in record year

The semiconductor manufacturer in Taiwan itself (TSMC) finds itself in an ideal stormy center: the unprecedented artificial intelligence chips require that it cannot fully satisfy the business tensions that threaten its business model, and the geopolitical risks that expose the fragility of the chains of supplying the international conductors.

Speaking at the TSMC annual shareholders meeting on Tuesday, CE WeI CEO presented a confident look at the semiconductor giant, saying that “our revenues and profits this year will determine new historical levels.”

The bullish projection comes as the company is wrestling with the indirect effects of American definitions while struggling simultaneously to meet the unprecedented demand for artificial intelligence requests.

The effect of the tariff is still managed despite industry concerns

Wei has dealt with increasing concerns about the impact of President Donald Trump’s commercial policies on the global chips industry, admitting that the definitions affect TSMC, but not directly.

“Definitions are imposed on importers, not exporters. TSMC is a source,” Wei explained to the shareholders. “However, tariffs can lead to a little rise in prices, and when prices rise, demand may decrease.”

He stressed that although TSMC works can be affected if the definitions collect prices and reduce the total demand for chips, the company’s position is still strong. “Our business will remain very good,” Way stated, adding: “I am not afraid of anything, I am just afraid that the global economy will decrease.”

Trump’s comprehensive introductory policies have created the great uncertainty in the semiconductor sector. The administration initially imposed a 32 % duty on imports from Taiwan as part of the broader commercial measures, although it was subsequently stopped for 90 days and semiconductors were significantly excluded from the fees.

Artificial intelligence applications drive unprecedented growth

Despite the opposite winds of commercial policy, the basic TSMC business continues to benefit from explosive growth in artificial intelligence applications. WeI emphasized that the demand for artificial intelligence chips is still “very strong” and is constantly superior to the company’s ability to offer.

He told the meeting: “Our mission is to provide our customers with sufficient drills, and we are working hard to do so.” Serious work “means that it is still not enough.” The company’s customer’s list includes Apple and NVIDIA technology giants, both of whom were major drivers to order the semiconductors associated with the Acting.

TSMC sales figures confirm this strong demand, as the company has reached 349.6 billion dollars (11.6 billion dollars) of revenues – an increase of 48.1 % over the previous year and a growth of 22.2 % of March.

Wei noticed that the partial increase from companies that store semiconductors before increasing the expected tariff, but stressed that the basics of the basic demand for artificial intelligence are still exceptionally strong.

Challenges to expand production capabilities

The mismatch between the demand for artificial intelligence chips and the available show has become a distinctive challenge for TSMC. Wei indicated that the company is actively working on “increasing the productive capacity to satisfy our customers”, although the volume of demand continues to force the capabilities of the most advanced semiconductor in the world.

These capabilities restrictions reflect the broader industry dynamics as AI applications – from data center processors to consumer devices – increase increasingly advanced and powerful chips that only a handful of manufacturers can be produced on a large scale.

Geopolitical pressures and expansion strategy

TSMC faces the increasing pressure to diversify the manufacturing imprint away from Taiwan, where most of the manufacturing factories are currently. Beijing’s continuous demands for Taiwan and threats to use force have increased concerns about the elasticity of the supply chain to produce critical semiconductors.

Wei directly dealt with modern media speculation about the potential expansion in the Middle East, and denial of reports that TSMC was studying the construction of chips factories in the United Arab Emirates. He said, “I think rumors really fly everywhere.” Bloomberg Reports that have not been named sources.

The company is actively creating manufacturing in other regions, with development facilities in the United States, Europe and Japan. These expansion efforts aim to address both geopolitical risks and customer demands for various geographical supply chains.

Organizational compliance and China’s relations

TSMC operations continue to move in complex regulatory requirements that extend to multiple judicial authorities. Wei confirmed that the company is working closely with the governments of Taiwan and the United States to ensure compliance with legal and regulatory requirements.

The company recently suspended shipments to China’s china’s chips designer after discovering that its identical components in a chip found in artificial intelligence treatments from Huawei Technologies, a Chinese company that is subject to large -scale American governmental restrictions.

This incident sheds light on the ongoing challenges facing TSMC in the budget for trade relations with organizational compliance.

Industry expectations and economic fears

While TSMC prospects in the short term looks strong, Wei has recognized the broader economic dangers that may affect the semiconductor industry. The suspension of the executive director about the fear of the economic decline reflects more than specific trade policies in recognition that global demand patterns ultimately pay industry wealth.

Performance expectations that determine the company’s record indicate that the current demand trends of artificial intelligence chips are strong enough to compensate for the possible opposite winds from commercial policies or broader economic uncertainty. However, the sustainability of this growth will probably depend on continuous progress in artificial intelligence applications and general health of the global economy.

(TSMC Photography)

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