TSMC quarterly profit seen soaring to record but Trump tariffs, forex a concern

Profit Surge Driven by AI Demand

Taiwan Semiconductor Manufacturing Co (TSMC), the world’s leading producer of advanced chips for artificial intelligence, is poised to report a record net profit for the second quarter of 2025. Analysts expect TSMC’s net income to hit T$377.4 billion (US$12.9 billion) for the period ending June 30, which would mark a 52% rise compared to the previous year and stand as the company’s highest-ever quarterly performance. This would also represent the sixth consecutive quarter of profit growth for the chip giant^[4].

Robust AI and Chip Industry Growth

• TSMC continues to benefit from soaring demand for AI chips, with global foundry industry revenue forecasted to grow 17-18% this year.
• As the main supplier to tech giants such as Nvidia and Apple, TSMC’s own revenue is likely to outpace the broader market, potentially expanding by as much as 30%, according to research firm IDC.
• The company's half-year revenue surged 40% to NT$1.77 trillion (US$60.8 billion), reflecting its dominant position and the scale of AI-driven demand^[3].

Geopolitical Risks: Tariffs and Currency Pressures

Despite its strong core business, TSMC’s outlook is clouded by global trade tensions and currency fluctuations:

• Uncertainty surrounds the impact of potential new U.S. tariffs on TSMC’s products, with President Donald Trump warning of “reciprocal” tariffs on over 20 countries starting August 1. While neighboring countries have received formal notices, Taiwan is still negotiating with Washington and has yet to receive a direct letter regarding the tariffs.
• The strong Taiwan dollar has also dampened the company’s share growth, which, after a surge of 80% last year, is up just 3.7% year to date^[4].

Strategic Moves to Mitigate Risks

To counterbalance potential tariffs and maintain favorable relations with U.S. policymakers, Taiwan has pledged:

• Increased investment in the United States
• Greater purchases of U.S. energy
• Enhanced defense spending

These measures are part of Taiwan’s broader strategy to address tariff threats and secure the island’s vital role in the global supply chain^[3].

Market Outlook

With TSMC controlling a commanding share of the AI chip market and demand projected to remain “very strong,” industry experts and company executives anticipate continued record earnings in 2025. Nevertheless, the final impact of U.S. trade measures and currency shifts will be closely watched by investors and the global tech sector.