Morgan Stanley: Taiwan Semiconductor may maintain revenue growth momentum in the next five years

Morgan Stanley analysts stated in a research report that driven by the demand for artificial intelligence chips and the outsourcing of integrated device manufacturers, Taiwan Semiconductor may continue to achieve a compound annual revenue growth rate of 15%-20% over the next five years. They mentioned that with strong demand for artificial intelligence chips and further increase in production of Apple's 3-nanometer chips, Taiwan Semiconductor's gross margin may slightly increase from 55% in the third quarter to 55.5% in the fourth quarter. They indicated that Taiwan Semiconductor is expected to maintain a gross margin of around 55% in 2025 and beyond after successfully raising wafer prices, with the adjustment taking effect next year. They added that considering the expected price increase of at least 10% for artificial intelligence chips, 6% for other high-performance computing chips, and 3% for smartphone chips, the average price increase in 2025 may be around 4%-5%, leading to a 2-3 percentage point increase in gross margin