(Bloomberg) — Taiwan Semiconductor Manufacturing Co.’s sales rose 34% in November, reflecting sustained growth from AI demand despite concerns that data center building will slow.
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The go-to chipmaker for Apple Inc. and Nvidia Corp. reported monthly sales of NT$276.1 billion ($8.5 billion). The combined sales in October and November rose 31.4%, based on Bloomberg’s calculations, while analysts project sales to grow 36.3% in the current quarter. TSMC’s shares are up about 80% so far this year.
The Taiwanese company is seen as a bellwether for the build-out of artificial intelligence data centers. Since ChatGPT was first launched in late 2022, TSMC and other AI hardware suppliers have enjoyed a boost from the massive spending on servers and data centers from big tech firms including Microsoft Corp. and Amazon.com Inc.
Investors are growing concerned about whether the spending will deliver returns, given the lack of a killer AI application. Still, TSMC is expected to gain pricing power as rivals Samsung Electronics Co. and Intel Corp. both struggle to gain traction in contract manufacturing.
What Bloomberg Intelligence Says
TSMC’s 34% year-over-year growth in November sales suggest it’s still on track to hit the upper end of guidance despite halts in supplies to Chinese AI-chip designers amid US export controls. Robust demand for AI and high-end smartphone chips drives growth, with momentum likely extending into 2025. If the two-month average run rate holds at 68.5%, as in the previous three years, TSMC’s 4Q sales could hit NT$861.5 billion.
– Charles Shum, analyst
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–With assistance from Ville Heiskanen.
(Updates with analyst’s comment from the fourth paragraph)
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