TSMC’s May Revenue Soars Despite Slowing Growth

The global chip giant, TSMC, reported May earnings of $10.7 billion, marking a 39.6% increase compared to the same period last year. However, this is an 8.3% drop from April’s figures, indicating a slowdown. Despite this, analysts had expected lower numbers, making the results better than anticipated. The company’s performance comes amid increasing demand for semiconductor components, especially for AI systems.

Growth Trends and Expectations

TSMC exhibits a steady growth trajectory, albeit at a slower pace compared to previous months. In April, the company enjoyed a 48% year-on-year revenue increase, whereas May saw a 39.6% rise. TSMC aims for a 39% revenue growth for the second quarter and anticipates a 24–26% overall increase by the year’s end.

The continuous demand for AI-related semiconductor components is a bright spot for TSMC, with supply struggling to keep up with the appetite.

Nvidia’s Assurance Amidst Sanctions

Recently, Nvidia, a major client of TSMC, released its quarterly report highlighting its resilience in maintaining robust revenue growth despite US-imposed export restrictions to China. This region accounts for roughly 12% of Nvidia’s revenue. In response to sanctions, Nvidia plans to offer Chinese customers accelerators built on its Blackwell architecture with GDDR7 memory. This strategic move is aimed at preserving its market share, which has dropped from 95% to 50% since the sanctions in 2022.

TSMC’s financial health and continued demand are pivotal, not only for its growth but also for clients like Nvidia who depend on its robust production capabilities.