TSMC Posts Sixth Consecutive Record Profit but Signals Caution for 2027

Taiwan Semiconductor Manufacturing Co. delivered its sixth consecutive quarter of record earnings, driven by persistent demand for artificial intelligence processors. As reported by The Next Web (https://thenextweb.com/news/tsmc-q3-2026-record-profit-prudent-2027), the contract chipmaker recorded a third-quarter net profit of NT$763.1 billion ($23.59 billion), a 69% increase year-over-year that surpassed the NT$746.3 billion LSEG SmartEstimate consensus cited by Reuters.

Revenue for the quarter climbed 51% year-over-year to NT$1.49 trillion, or 41.2% in U.S. dollar terms to $46.72 billion, yielding an operating margin of 58.7%. High-performance computing represented 68% of total revenue, while smartphone applications contributed 21%. Advanced manufacturing at the 3-nanometer node accounted for 33% of wafer revenue.

For the fourth quarter, TSMC projects revenue between $52.3 billion and $54.3 billion, compared to $33.73 billion in the prior-year period. The company lifted its full-year 2026 revenue growth guidance in U.S. dollar terms to approximately 44%, up from earlier projections of more than 40%.

Despite current momentum, TSMC Chairman and Chief Executive C.C. Wei expressed caution regarding 2027 during the earnings call, pointing to headwinds in consumer and price-sensitive segments from higher component costs and macroeconomic uncertainty. TSMC stated that overall customer demand continues to exceed production capacity, showing no signs of deceleration in the broader AI buildout.

To expand output, TSMC plans to construct an additional 3nm facility in Tainan scheduled for production in the first half of 2028, according to The Information. Construction on its second fabrication plant in Arizona is complete, with mass production slated for the third quarter of 2027. Bloomberg also reported that TSMC has dispatched personnel to review U.S. data center construction and power infrastructure while evaluating a potential campus in Texas.

TSMC reaffirmed its 2026 capital spending target of $60 billion to $64 billion. Chief Financial Officer Wendell Huang noted that capital expenditures between 2026 and 2028 will significantly exceed the prior three-year period. On the call, Wei reiterated that any fabrication facilities developed under potential Terafab partnerships must remain under TSMC's direct operational control.