Before Asian markets opened today, Taiwan’s major chipmaker, Taiwan Semiconductor Manufacturing (NYSE:), reported its results for the final quarter of 2025. The numbers were much stronger than what the market expected across key measures.
The company continues to benefit from strong demand linked to artificial intelligence, where its chips are widely used. Demand could also improve further as the US and Taiwan move closer to a trade agreement. Under this plan, the company has agreed to expand its operations in Arizona in return for lower tariffs.
TSMC also said it will raise capital spending this year to more than $50 billion. Its share price has been moving higher, and the strength of these results suggests that trend could continue.
TSMC’s Growth Overshadowed by Geopolitical Threats
Taiwan Semiconductor Manufacturing Company plays a critical role in the global tech industry because it leads the production of advanced chips used in artificial intelligence and other high end technologies.
Its position also brings political risk. China openly claims Taiwan as its own and sees it as a breakaway territory. As Taiwan has strengthened its military and security cooperation with the United States, China has responded with tougher language and visible military exercises.
Investors continue to watch these developments closely. Any rise in the risk of a conflict involving Taiwan would likely influence market sentiment around the company.
Looking back at the results, here is how the company performed in terms of earnings per share and revenue:
Source: InvestingPro
The company’s strong financial position is also reflected in a financial health score of 4 out of 5.
Source: InvestingPro
Among the other figures, gross and net margins also came in above market expectations, at 48.3% and 38.8%. Chips made using the 5-nanometer process currently generate the largest share of revenue at 35%. The newer and more advanced 3-nanometer chips already account for a strong 28%, which points to steady progress in next-generation products.
As part of a likely trade agreement between Taipei and Washington, Taiwan Semiconductor Manufacturing Company plans to expand production in Arizona. This would involve building five additional factories and would roughly double its current capacity in the US. Markets are likely to view this positively, as it supports higher investment spending while also spreading production across more locations, a factor that carries growing importance in the current environment.
Where to Look for Opportunities in TSMC’s Stock Price?
At present, Taiwan Semiconductor Manufacturing Company shares are trading close to record levels, around $336. The base case remains for the upward trend to continue. After the market’s positive response to the results, any pullbacks are likely to be limited and short-term.
For those looking to enter at lower levels, key support areas are based on earlier highs. The first level to watch is around $310 per share, followed by a deeper support near $270. A move below the $270 level could signal that the upward trend in Taiwan Semiconductor Manufacturing Company shares is coming under pressure.
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Disclaimer: This article is written for informational purposes only. It is not intended to encourage the purchase of assets in any way, nor does it constitute a solicitation, offer, recommendation or suggestion to invest. I would like to remind you that all assets are evaluated from multiple perspectives and are highly risky, so any investment decision and the associated risk belong to the investor. We also do not provide any investment advisory services.
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