Taiwan Semiconductor CEO just dropped a hint about the next move in AI stocks

Taiwan Semiconductor (TSM) conscionable dropped an important hint that should excite the resurgent AI banal bulls.

"AI-related request continued to beryllium highly robust," Taiwan Semiconductor CEO C.C. Wei told analysts connected a league telephone connected Thursday. "The displacement from generative AI and the query mode to agentic AI and ... the enactment mode is starring to different measurement up successful the magnitude of tokens being consumed. This is driving the request for much and much computation, which supports the robust request for leading-edge silicon."

"Our customers and customers of customers, the unreality work providers, proceed to supply america with their precise beardown awesome and affirmative outlook," Wei continued. "Thus, our condemnation successful the multiyear AI megatrend remains high, and we judge the request for semiconductors volition proceed to beryllium precise fundamental,"

Read more: Live sum of firm earnings

TSMC is the world's largest dedicated autarkic semiconductor foundry, producing the immense bulk of the world's astir precocious processors. Its apical 3 customers see Apple (AAPL), Broadcom (AVGO), and Nvidia (NVDA).

The information that TSMC hasn't seen immoderate slowdown successful AI-related request bodes good for the financials of its customers and galore players further downstream. And by extension, their banal prices.

Wei added, "Moving into the 2nd 4th of 2026, we expect our concern to beryllium supported by continued beardown request for our leading-edge process technologies."

Shares declined 1% successful premarket trading.

A batch of the momentum elaborate by Wei was connected show successful the company's archetypal 4th net merchandise today.

The institution posted a grounds nett net of 572.5 cardinal New Taiwan dollars ($18.15 billion), up a steadfast 58.3% implicit the aforesaid play past year. Revenue for the 4th surged 35% to $35.9 billion, fueled by "insatiable" planetary request for AI infrastructure.

The foundry’s profitability was peculiarly notable amid representation spot terms inflation. Its gross nett borderline expanded to 66.2%, importantly beating its ain guidance.

Executives raised their full-year gross maturation forecast to implicit 30%.

Wei besides signaled that TSMC is leaning toward the precocious extremity of its $56 cardinal superior expenditure fund for the twelvemonth to enactment the AI infrastructure buildouts of its customers.

"Another affirmative quarter. Reiterate Overweight rating," Barclays expert Simon Coles said successful a note.

Brian Sozzi is Yahoo Finance's Executive Editor and a subordinate of Yahoo Finance's editorial enactment team. Follow Sozzi connected X @BrianSozzi, Instagram, and LinkedIn. Tips connected stories? Email [email protected].