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TSMC's net profit rose 69% year-on-year to NT$763.1 billion in the third quarter, benefiting from strong demand for AI chips; the company also said it is evaluating the possibility of expanding its chip manufacturing capacity in Texas, USA.

Taiwan Semiconductor Manufacturing Co. (TSMC) on Thursday reported record third-quarter profit as demand for artificial intelligence (AI) chips remained strong. The company also said it was assessing the possibility of expanding its chipmaking operations in Texas, underscoring the continued global appetite for advanced semiconductor capacity.

According to Reuters, TSMC's third-quarter net profit reached NT$763.1 billion, up 69% from a year earlier and above market expectations. Revenue rose 51% to about NT$1.49 trillion, also setting a new record. Demand for advanced chips from technology companies including Nvidia and Apple was a key driver of the company's performance.

TSMC Chairman and Chief Executive Officer C.C. Wei said at an earnings briefing that demand in the AI market remained very strong, with customer demand still exceeding the capacity the company could provide. TSMC is working to narrow the supply-demand gap. The continued expansion of AI computing capacity is driving demand for advanced process technologies and related chip manufacturing, making TSMC an important indicator of the global AI industry's development.

Overseas capacity expansion was another focus of the earnings briefing. According to the Associated Press, TSMC is assessing the possibility of adding US chipmaking capacity in Texas and has dispatched a team to evaluate the proposal. The company also confirmed that it was in discussions about the Terafab chipmaking project associated with US entrepreneur Elon Musk.

TSMC stressed that the proposals remained under evaluation and that, if a plant were built in Texas, its operations would have to be controlled by TSMC. The company has previously committed to investing heavily in Arizona as it continues to expand its US manufacturing footprint.

TSMC nevertheless remains cautious about the market outlook. Wei said some consumer and price-sensitive markets were being affected by higher component prices and macroeconomic uncertainty, so the company would maintain a cautious approach as it plans its business for 2027.

TSMC's results highlight the importance of AI demand to Taiwan's semiconductor industry. Overseas expansion, capital spending, geopolitics and changes in the global economy, however, will continue to shape the industry's investment and competitive landscape.