TSMC’s Slowing Monthly Sales Fuel AI Sustainability Debate

(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. reported slowing maturation successful monthly revenue, highlighting uncertainty implicit the sustainability of the AI roar adjacent arsenic manufacture behemoths including Nvidia Corp. pursuit much spot supplies.

The institution posted a 16.9% emergence successful income for October, the slowest gait since February 2024. Analysts connected mean are expecting income to summation 16% successful the existent quarter. TSMC’s American depository receipts were up arsenic overmuch arsenic 3% successful pre-market trading.

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Industry executives stay buoyant astir AI-driven maturation arsenic large tech firms are accelerating investments successful information centers. The TSMC gross summation besides conscionable covers conscionable a azygous period of business, offering investors little insight.

Still, the marketplace is connected edge.

Investors were jolted past week by a abrupt slump successful Asia’s exertion shares, which served arsenic a stark reminder that the world-beating rally successful artificial quality and semiconductor stocks whitethorn beryllium nearing a short-term crest. Wall Street main executives person warned of an overdue marketplace correction, with Michael Burry’s Scion Asset Management besides disclosing bearish wagers connected Nvidia.

That’s contempt monolithic ample spending plans from starring AI players.

Meta Platforms Inc., Alphabet Inc., Amazon.com Inc. and Microsoft Corp. volition collectively walk much than $400 cardinal to money an AI buildout adjacent year, a 21% hike from 2025, to unafraid enactment successful the contention successful emerging technologies.

Chief Executive Officer Jensen Huang of Nvidia, which is the superior AI spot supplier to large companies, said connected Saturday his concern is “growing period by month, stronger and stronger.”

Huang met TSMC Chief Executive Officer C.C. Wei and asked for much spot supplies during his two-day whirlwind travel to Taiwan this clip erstwhile large spot designers are each chasing constricted supplies from the Hsinchu-based company.

TSMC is besides the go-to chipmaker for the Santa Clara, California-based firm’s competitors including Advanced Micro Devices Inc. and Qualcomm Inc., and it makes Apple Inc.’s silicon for iPhones and different gadgets.

Huang’s optimism is shared by his rivals. Qualcomm Chief Executive Officer Cristiano Amon told Bloomberg TV past week that the satellite is underestimating however large AI volition get.