TSMC is scheduled to report its 2026 second-quarter earnings before the market opens on July 16 (Thursday),$Taiwan Semiconductor Manufacturing(TSM)$
After reporting a 67.9% year-over-year jump in June revenue, TSMC's first-half revenue reached NT$2.4 trillion, up 35.6% from a year ago. June revenue also increased 6.2% month over month, bucking the seasonal slowdown seen in recent years. With AI demand remaining exceptionally strong, the company has already exceeded the high end of its own second-quarter revenue guidance.
What to Watch This Quarter
AI remains the biggest growth engine for TSMC.From NVIDIA, Apple and AMD to the world's largest cloud providers, demand for advanced AI chips continues to outpace supply. Analysts estimate that AI chips could contribute more than $40 billion of TSMC's revenue in 2026, accounting for roughly one-quarter of total sales.
Management previously guided for Q2 revenue of $39-40.2 billion, with gross margin between 65.5% and 67.5%. Wall Street currently expects revenue of roughly $39.3-$39.8 billion and EPS around $3.8 per share, representing another quarter of strong double-digit growth.
Beyond the headline numbers, investors will be closely watching whether TSMC raises its full-year revenue outlook, increases its 2027 capital expenditure plan, and provides updates on the ramp of its 2nm process technology and expansion of advanced CoWoS packaging capacity. Several analysts also expect management to discuss whether AI demand remains supply-constrained heading into 2027.
The biggest question is whether TSMC can continue delivering results that justify its recent rally. The stock gained nearly 40% during the April-June quarter, as investors bet that hyperscalers will continue spending aggressively on AI infrastructure.
If management raises guidance again and delivers another strong outlook, investors may see it as further confirmation that the AI investment cycle still has room to run. However, any signs of slowing AI demand, margin pressure from overseas fabs, or weaker-than-expected guidance could trigger increased volatility after earnings.
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How to Participate
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【Prizes】
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Event Period
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Ends: 12:00 PM SGT, July 16
Comments
PCT = Pandas Coffee Talk.
Current Price Range: TSM has been trading in the $420–$430 range recently.
Analyst Consensus: Analysts have an average 1-year price target of roughly $498, with high estimates going up to $700.
The Catalyst: The July 16 earnings call is viewed as a bellwether for the entire AI and hardware supply chain. Strong guidance could push the stock higher, while cautious outlooks could pull it back.
My guess is $420 pullback.