The Taiwan Semiconductor Manufacturing Co. (TSMC) reported a 40% profit increase in the third quarter of 2024. The company’s impressive performance is due to an increased demand for its AI chips by companies like AMD, Nvidia, and Tesla.

TSMC's Profit and Revenue Growth

TSMC recorded a profit of over $9 billion in the third quarter of the financial year against the $6.5 billion seen in 2023. Revenue reached $23.5 billion, up 36.5%. This successful third quarter is attributed to the demand AI technology has created in the semiconductor industry.

TSMC's Market Dominance

TSMC continues to dominate the AI chip market, particularly in the USA, where it has expanded operations in response to geopolitical tensions. The company has invested about $65 billion in new labs in Arizona. However, TSMC may face competition from Korean manufacturer Samsung, as well as from American companies Intel and AMD.

AI’s Impact on the Global Economy

The semiconductor industry isn’t the only one benefitting from the AI boom. Financial analysts project that about $15 trillion might be added to the global economy by 2030 through AI products. TSMC’s success depends largely on access to chip-making materials, and potential trade disruptions from geopolitical tensions could significantly impact the company's performance.

TSMC has demonstrated strong performance due to AI chip demand, yet its future success will rely on the evolving geopolitical landscape and competitive actions in the market.