Key Points
Taiwan Semiconductor Manufacturing Company (TSMC) reported strong financial results and announced plans to increase capital expenditures from $41 billion in 2025 to between $52 billion and $56 billion in 2026, indicating a robust demand for AI chips. The company’s spending will drive growth not only for itself but also for key partners, including Nvidia, Broadcom, AMD, and memory manufacturers like Micron Technology.
As TSMC ramps up its capital expenditures, it is expected to significantly benefit ASML, the sole supplier of machines needed for advanced semiconductor manufacturing. The tight memory market for high-bandwidth memory will push prices up, favoring companies like Micron, SK Hynix, and Samsung, while the major cloud service providers, such as Amazon and Microsoft, are also set to expand their data center capacities to support increasing demand for AI services.
