TSM Stock: Taiwan Semiconductor Smashes Q3 Earnings Target

Taiwan Semiconductor Manufacturing Co., Ltd TSM on Thursday beat analyst estimates for the third quarter and guided above views for the current period. TSM stock reached an all-time high on the news but later retreated.

The world’s largest contract chip maker, known as TSMC, earned $2.92 per US share on sales of $33.1 billion in the September quarter. Analysts polled by FactSet had expected earnings of $2.63 per share on sales of $32.07 billion. In the same period a year earlier, TSMC earned $1.95 per share on sales of $23.62 billion.

In local currency, TSMC’s profits increased 39% year-on-year while sales rose 30.3%.

For the current quarter, TSMC expects revenue in the range of $32.2 billion to $33.4 billion. The midpoint of $32.8 billion exceeded Wall Street’s target of $31.55 billion. In the fourth quarter of last year, it recorded sales of $26.38 billion.

In morning trading on the stock market today, TSM stock hit a record high of 311.37 before falling. It fell 1.3% to 300.83 in recent trading.

On September 9, TSM stock broke out of a flat base at a buy point of 248.28, according to IBD MarketSurge charts.

TSM stock is on four IBD listings

“Our third-quarter business was supported by strong demand for our leading process technologies,” CFO Wendell Huang said in a press release. “Moving into the fourth quarter of 2025, we expect our business to be supported by continued strong demand for our leading process technologies.”

In the third quarter, 3nm chip shipments accounted for 23% of TSMC’s total chip revenue and 5nm chips accounted for 37%. Advanced technologies, defined as nodes with a resolution of 7 nanometers or smaller, accounted for 74% of total chip revenue.

TSMC produces chips for AMD (AMD), apple (Apple), Broadcom (AFGO), Nvidia (NVDA), Qualcomm (QCOM) and other companies.

TSMC has recently benefited from increased production of AI data center chips, especially for Nvidia.

Needham analyst Charles Shi reiterated a buy rating on TSM shares and raised his price target to 360 from 270.

TSMC’s strong third-quarter results were the result of increased AI chip production, operational efficiency and capital discipline, he said in a client note.

TSM stock is on four IBD stock lists: IBD 50, Stock Spotlight, Global Leaders, and Tech Leaders.

Follow Patrick Seitz on X at IBD_PSeitz for more stories on consumer technology, software, and semiconductor stocks.

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