Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) regained its US$500 billion market capitalization after investors ramped up bets on tech leaders best placed to ride an anticipated artificial intelligence (AI) boom.
Asia’s most valuable company gained 3.31 percent yesterday in Taipei trading, fueled also by hopes that a post-COVID-19 chip downturn is nearing an end. That took its gain to 32.22 percent so far this year, cementing its position among the world’s 10 most valuable corporations after overtaking Visa Inc last month.
TSMC’s gains contributed about 160 points alone to the TAIEX yesterday, which closed up 261.23 points, or 1.54 percent, at 17,216.60, the highest since April 14 last year, when the benchmark index closed at 17,245.65.
Photo: Sam Yeh, AFP
“Investors remained upbeat about AI development, and TSMC is one of the biggest beneficiaries,” Mega International Investment Services Corp (兆豐國際投顧) analyst Alex Huang (黃國偉) said.
Morgan Stanley this week raised TSMC’s price target, citing higher demand for energy-efficient and low-cost AI custom chip designs.
“With the killer apps of generative AI [such as ChatGPT], we are seeing the semi industry’s growth stage shifting from the mobile computing to the AI computing era,” Morgan Stanley analysts wrote over the weekend. “We view TSMC as a key enabler of future AI semis given its technology leadership.”
Meanwhile, Cathie Wood’s funds have re-entered TSMC and Meta Platforms Inc after nearly a year and a half, as the high-profile manager makes new bets on AI and chips.
Two Ark Investment Management LLC funds, including Wood’s flagship Ark Innovation ETF, bought 174,848 shares of Facebook’s parent company on Monday, while Ark Autonomous Technology and Robotics ETF picked up 98,170 shares of TSMC, data compiled by Bloomberg showed.
Before this, Ark last held the two stocks in the final quarter of 2021.
Ark’s moves came weeks after Wood spoke highly of Meta’s AI strategy and said her decision to drop Nvidia Corp was due to the company facing growing competition.
She added during an interview with Bloomberg last month that she would pivot “to another set of plays.”
Wood’s other AI-related bets include electric vehicle maker Tesla Inc among large caps and UiPath Inc, Twilio Inc and Teladoc Health Inc among smaller names.
The broader rally persists despite warnings that the market might be getting ahead of itself, given the uncertainty over how to monetize AI services.
TSMC, while touting its own potential role in the rollout of AI, has expressed caution over the outlook for the smartphone market that still comprises a significant chunk of its revenue, although company executives have called for a gradual recovery in the second half and a resumption of growth next year.
Last week, TSMC chairman Mark Liu (劉德音) said the chipmaker’s capital expenditure for this year might wind up close to the bottom end of a previously forecast range of US$32 billion to US$36 billion. That is a signal that TSMC, like its rivals across the electronics industry, remain cautious in the face of plunging consumer spending and an uneven post-COVID-19 economic recovery in China.
Additional reporting by CNA
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
INDUSTRY LEADER: TSMC aims to continue outperforming the industry’s growth and makes 2025 another strong growth year, chairman and CEO C.C. Wei says Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
RSS