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TSMC Reports Second Quarter Revenue Increased 44.4% Year-Over-Year

Daniel Nenni

Daniel Nenni

Admin
Staff member
HSINCHU, Taiwan, R.O.C., Jul. 17, 2025 -- TSMC (TWSE: 2330, NYSE: TSM) today announced consolidated revenue of NT$933.79 billion, net income of NT$398.27 billion, and diluted earnings per share of NT$15.36 (US$2.47 per ADR unit) for the second quarter ended June 30, 2025.

Year-over-year, second quarter revenue increased 38.6%, while net income and diluted EPS both increased 60.7%. Compared to first quarter 2025, second quarter results represented a 11.3% increase in revenue and a 10.2% increase in net income. All figures were prepared in accordance with TIFRS on a consolidated basis.

In US dollars, second quarter revenue was $30.07 billion, which increased 44.4% year-over-year and increased 17.8% from the previous quarter.
Gross margin for the quarter was 58.6%, operating margin was 49.6%, and net profit margin was 42.7%.

In the second quarter, shipments of 3-nanometer accounted for 24% of total wafer revenue; 5-nanometer accounted for 36%; 7-nanometer accounted for 14%. Advanced technologies, defined as 7-nanometer and more advanced technologies, accounted for 74% of total wafer revenue.

TSMC Reports Second Quarter EPS of NT$15.36

TSMC Spokesperson​

Wendell Huang
Senior Vice President & Chief Financial Officer
Tel:886-3-5055901

TSMC Deputy Spokesperson​

Nina Kao
Public Relations Division
Tel:886-3-5636688 Ext.7125036
 
I am curios as to why TSMC is sticking with the 30% 2025 growth number. Clearly they are going to exceed that number unless tariffs or something else nefarious is looming?
 
Daniel Nenni said:
I am curios as to why TSMC is sticking with the 30% 2025 growth number. Clearly they are going to exceed that number unless tariffs or something else nefarious is looming?
Click to expand...

They probably read your post :)

Semiconductor Fundamentals Are All Weak

Executive Summary Annualised growth rates retreated slightly in May, with Total Semiconductors growing 18.2 percent, down from last month’s 22.8 percent and March’s 18.7 percent and, whilst still in double-digit growth terrain, was still sizeably down from August 2024’s 28.5 percent cyclical...
semiwiki.com
 
Daniel Nenni said:
I am curios as to why TSMC is sticking with the 30% 2025 growth number. Clearly they are going to exceed that number unless tariffs or something else nefarious is looming?
Click to expand...

One possibility is that the second half of 2024 revenue was already based on higher pricing. Under the contract pricing signed last year or earlier between TSMC and its customers, and given the very tight capacity utilization, there is limited room to achieve much more than 30% revenue growth in the second half of 2025.

A recurring theme in this TSMC earnings call was that "capacity is very tight" or that there is "no extra capacity to pull in more revenue."
 
AI summary of the call:

On July 17, 2025, TSMC held its Q2 2025 earnings call, hosted by Director of Investor Relations Jeff Su. Senior VP and CFO Wendell Huang presented the quarterly financial performance, Q3 guidance, and long-term financial expectations. Chairman and CEO Dr. C.C. Wei elaborated on demand trends, technology ramp-up, global expansion, and strategic direction.

Financial Performance (Q2 2025)
TSMC reported Q2 revenue of USD $30.1 billion, a 17.8% sequential increase, driven by strong demand for 3nm and 5nm technologies. Gross margin slightly declined to 58.6% due to unfavorable exchange rates and initial dilution from overseas fabs, especially Arizona. However, operating margin improved to 49.6%. EPS rose 60.7% YoY to TWD 15.36, with ROE at 34.8%.

Advanced nodes (7nm and below) comprised 74% of wafer revenue, with 3nm at 24%, 5nm at 36%, and 7nm at 14%. By platform, HPC led with 60% of revenue, followed by smartphones (27%), IoT (5%), automotive (5%), and DCE (1%).

Cash and marketable securities stood at TWD 2.6 trillion (USD $90B). TSMC generated TWD 497B in cash from operations, spent TWD 297B in CapEx, and distributed TWD 117B in dividends.

Q3 2025 Guidance
TSMC expects Q3 revenue between USD $31.8B–$33B, up 8% sequentially and 38% YoY at midpoint. Gross margin is forecast at 55.5%–57.5%, and operating margin at 45.5%–47.5%. The full-year CapEx remains $38B–$42B.

Impact of FX and Overseas Fabs
TSMC emphasized the NT dollar's appreciation significantly reduced NT revenue and gross margin. A 1% NT appreciation cuts NT revenue by 1% and gross margin by ~40bps. FX-driven margin dilution will continue as overseas fabs scale. Despite this, TSMC reiterated confidence in maintaining long-term gross margin ≥53% through technology leadership, cost efficiency, and value-based pricing.

AI and Demand Outlook
Wei reaffirmed strong AI and HPC demand as core revenue drivers, expecting FY25 USD revenue growth of ~30%. AI usage and sovereign AI efforts are boosting silicon consumption. However, TSMC remains cautious amid potential tariffs and consumer weakness.

Technology Roadmap
TSMC's 2nm (N2) node is on track for volume in H2 2025, offering 10–15% speed or 20–30% power gains vs. N3E. Its N2P extension is due in H2 2026. A16, launching in H2 2026, brings 8–10% speed and 15–20% power improvements over N2P, with higher chip density, suited for HPC. A14, with second-gen nanosheets, will debut in 2028, continuing performance leadership.

Global Expansion
TSMC plans six fabs in Arizona (N4 to A16), two advanced packaging facilities, and a major R&D center. The first Arizona fab began high-volume production in Q4 2024. The second fab (N3) construction is complete, and the third (N2 + 1.6nm) is underway. TSMC aims to locate 30% of its 2nm+ capacity in the U.S. Kumamoto’s first fab (Japan) began volume in late 2024, with a second fab planned. The Dresden fab (Germany) is also progressing. Taiwan remains core, with 11 wafer fabs and four packaging facilities planned.

Q&A Highlights
TSMC reaffirmed tight capacity for N3 and N5, with aggressive CoWoS expansion to meet AI demand. N2 will see stronger ramp than N3, but fab build limits speed. AI and HPC adoption of A16 is rising due to its power efficiency. TSMC denied demand pull-in for 2026 and reiterated disciplined CapEx despite growing demand. ROI for N2 is projected to be structurally better than N3.

www.marketscreener.com

Transcript : Taiwan Semiconductor Manufacturing Company Limited, Q2 2025 Earnings Call, Jul 17, 2025

Presenter SpeechJeff Su [Foreign Language] Good afternoon, everyone, and welcome to TSMC's Second Quarter 2025 Earnings Conference Call. This is Jeff Su, TSMC's Director of Investor Relations and... -July 17, 2025 at 04:50 am EDT - MarketScreener
www.marketscreener.com www.marketscreener.com
 
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