Taiwan Semiconductor reported first-quarter revenue of $35.898 billion ($1.13 trillion New Taiwan dollars), up 35.1% year-over-year, topping the analyst consensus estimate of $35.500 billion. Net income and earnings per share were 572.48 billion New Taiwan dollars and 22.08 New Taiwan dollars per share ($3.49), respectively, versus the analyst consensus of $3.31. In dollar terms, revenue growth was 40.6% Y/Y and 6.4% Q/Q. The top-line performance aligned with the company’s guidance of $34.6 billion-$35.8 billion.
Demand for advanced processor node technologies for Artificial Intelligence applications continued to drive performance. The company said that 3-nm accounted for 25% of total revenue, 5-nm accounted for 36%, and 7-nm accounted for 13%. 7-nm and more advanced technologies accounted for 74% of total wafer revenue. Taiwan Semiconductor’s Artificial Intelligence technology moat helped it expand its quarterly gross margins by 740 bps to 66.2%. Taiwan Semiconductor’s operating margin expanded by 960 bps to 58.1%.
The company now expects capital expenditure to land at the higher end of its $52 billion to $56 billion range, reflecting continued confidence in long-term Artificial Intelligence demand and capacity expansion plans. The increased spending aligns with its upgraded outlook of more than 30% annual revenue growth. Management said capacity will likely remain tight through 2027, supporting pricing and margins, while reaffirming strong full-year growth above 30%.
CEO C.C. Wei said demand remains robust and customer feedback continues to point to a very positive outlook, reinforcing confidence in a multi-year Artificial Intelligence growth cycle. He said customers such as Intel and Tesla can also be rivals, but success in the foundry business depends on technology leadership, manufacturing excellence, and customer trust. CFO Wendell Huang said the company does not expect near-term production interruptions and that Taiwan has secured sufficient liquefied natural gas supplies through at least May. He added that specialty gases such as helium and hydrogen are being sourced from multiple regions, with no material impact expected on output.
Taiwan Semiconductor is guided for second-quarter 2025 revenue of $39.00 billion-$40.20 billion versus the $39.52 billion consensus estimate. It expects a gross margin of 65.5%-67.5% and operating profit margins of 56.5%-58.5%. The board approved 6.00 New Taiwan dollars cash dividend for the fourth-quarter of 2025. Shares were down 2.37% at $366.20 during premarket trading on Thursday, approaching the 52-week high of $390.20.
