Taiwan Semiconductor's June revenue rises against the trend, with AI chips supporting the performance foundation

According to TSMC's monthly financial report, the company's consolidated revenue in June reached NT$442.68 billion, a month-on-month increase of 6.2% compared to May, and a year-on-year surge of 67.9%. TSMC's cumulative revenue for the first half of the year was NT$2.4 trillion, approximately USD 74.99 billion, a 35.6% increase compared to the same period in 2025.

In the past four years, TSMC's revenue in June has generally declined month-on-month compared to May. SemiAnalysis analyst Slavan Kundujala stated in an interview that this year's revenue has risen against the trend, showing strong performance, which has attracted significant attention from several analysts due to this break from seasonal norms.

Compared to the impressive year-on-year growth rate, the signal of growth against the seasonal downturn is more worthy of in-depth interpretation. TSMC's monthly revenue for April, May, and June can essentially outline the overall performance profile for the second quarter in advance. Kundujala estimated that the total revenue for the second quarter has already exceeded TSMC's first-quarter financial report guidance upper limit of USD 40.2 billion (this guidance is based on fixed exchange rates), which is also a key positive signal released by the June revenue data.

The increase in revenue is not due to a sudden surge in downstream demand; fundamentally, the advanced process capacity is completely in short supply. Kundujala pointed out that TSMC's N3 (3-nanometer) process capacity is now fully sold out, with almost all mainstream flagship AI graphics cards and CPUs using this process for manufacturing.

NVIDIA, Apple, and AMD are TSMC's top customers. Both NVIDIA and Apple are among the "Magnificent Seven" in the U.S. stock market, while TSMC is not on that list.

AI chip business officially becomes TSMC's core growth engine

Kundujala revealed that TSMC's AI chip-related revenue is expected to exceed USD 40 billion by 2026, accounting for nearly 25% of the company's total revenue. A few years ago, AI chip foundry services were negligible in TSMC's revenue, but now they are approaching a quarter of the overall revenue.

The high revenue dependency on a single business has both advantages and disadvantages: this also explains why a single advanced process capacity being fully loaded can directly reverse the trend of declining revenue during the off-season for four consecutive years. In the past, the smartphone business determined TSMC's overall revenue rhythm, but now the company's short-term performance trends are more dominated by the accelerated demand for AI chips.

For investors, the core focus is on pricing power. When capacity is in short supply, TSMC has traditionally maintained or even raised prices for the most advanced processes, rather than relying on low prices to capture orders; even if the growth rate of shipments in other product lines slows down, this model can still stabilize the company's gross margin levels.

Research firm Counterpoint's data shows that in the first quarter of 2026, TSMC's market share in the global pure wafer foundry market reached 73%. Such a high market concentration means that the operation of the entire AI supply chain heavily relies on TSMC's capacity delivery, and opportunities and industry risks are also highly concentrated.

This has made Thursday's earnings call highly anticipated by the market: investors have already predicted that the company's performance will exceed previous guidance based on June data, and the focus will be more on management's statements regarding capacity planning and foundry pricing strategies for the second half of the year