TSMC’s AI-fuelled sales surge puts tariff fears in the shade Proactive uses images sourced from Shutterstock
Wedbush’s bullish read on TSMC’s March numbers reveals a chipmaker so deeply embedded in the AI supply chain that macro headwinds are struggling to leave a mark.
The headline numbers from Taiwan Semiconductor Manufacturing Co (ADR) (NYSE:TSM) were strong by any measure, with March revenues rising 45% year on year to NT$415.19 billion and the first quarter coming in around 2% ahead of consensus, but Wedbush argues the more significant signal lies in what the results reveal about the structural demand underneath them.
Advanced node chip production, the bleeding-edge manufacturing that only TSMC can reliably deliver at scale, is running at capacity, and Wedbush sees nothing in the order books to suggest that changes through 2026.
That matters because TSMC sits at the intersection of every major technology theme driving markets right now, supplying chips for artificial intelligence accelerators, next-generation smartphones, and the data centre build-out that is consuming capital at a pace that has surprised even its most bullish observers.
Wedbush’s read-through analysis for Nvidia is particularly striking, with the broker suggesting TSMC’s management has once again structured output in a way that positions Nvidia to beat its own quarterly forecasts, a pattern that has repeated itself consistently over the past two years.
The Apple signal is arguably just as significant in the near term, given broader anxiety about consumer electronics demand in a tariff-disrupted environment.
Wedbush says industry conversations this week point to year-on-year iPhone unit growth, a notably resilient outcome at a moment when memory shortages and price pressures are squeezing most of the handset industry.
For TSMC itself, the currency picture merits attention: the Taiwan dollar came in around 1.2% weaker against the US dollar in March than in February, which is modestly helpful for margins given that TSMC’s revenues are predominantly dollar-denominated while its costs are largely in local currency.
Wedbush notes that for each 1% move in exchange rates, TSMC’s gross margins are affected by approximately 0.4 percentage points, making the current weak Taiwan dollar environment a quiet tailwind as the company targets a full-year gross margin of around 63.7%.
The broker’s 2026 revenue estimate of NT$5,000 billion implies growth of around 31% on last year’s NT$3,809 billion, a trajectory it believes is underpinned by the continued structural shift toward more compute-intensive AI workloads rather than a cyclical rebound in conventional semiconductor demand.
Wedbush reiterates its outperform rating and NT$2,200 price target, implying upside of around 13% from the current level.