Taiwan Semiconductor Manufacturing Co (NYSE:TSM) is expected to post a 52% jump in second-quarter 2025 profit, driven by booming AI demand. However, it faces pressure from potential U.S. tariffs and a sharply stronger Taiwan dollar.
IDC’s group VP Mario Morales told Reuters the foundry sector could grow 17–18% in 2025, but Taiwan Semiconductor’s moat may push its sales growth closer to 30%.
According to LSEG SmartEstimate, the company is forecast to report 377.4 billion New Taiwan dollars ($12.9 billion) in net profit for the quarter. If it exceeds 374.68 billion New Taiwan dollars, that would mark its highest-ever quarterly profit and its sixth straight quarter of earnings growth.
Also Read: Taiwan Semiconductor Shifts Focus To $100 Billion USA Expansion Instead Of Japan
Taiwan Semiconductor has already guided for a 38.6% jump in second-quarter revenue.
The stock traded higher on Tuesday in solidarity with its semiconductor peers after reports indicated the Trump administration’s plans to unveil a $70 billion tech and energy investment plan in Pennsylvania and that the U.S. lifted chip export curbs to China.
TSMC stock surged nearly 20% year-to-date, topping the PHLX Semiconductor Index’s 16% as a key supplier of Nvidia (NASDAQ:NVDA) and Apple (NASDAQ:AAPL).
Profit Headwinds
However, the company faces external headwinds. In April, the U.S. threatened Taiwan with a 32% reciprocal tariff, and President Donald Trump recently indicated new chip tariffs could arrive soon.
On the currency front, the Taiwan dollar has strengthened 12% against the U.S. dollar this year. Taiwan Semiconductor has noted that a 1% rise in the Taiwan dollar typically reduces its gross margin by 0.4 percentage points.
On the management front, Taiwan Semiconductor announced Friday that Vanessa Lee, head of materials management, resigned for personal reasons. Senior Vice President and Deputy Co-COO Cliff Hou will immediately assume leadership of his materials management division.
Lee joined Taiwan Semiconductor in 2022 and became vice president in August 2023. She developed forecasting systems and supply chain performance tools, earning credit for helping the chipmaker manage disruptions during the 2020 pandemic.
In March, the company committed $100 billion to expand U.S. operations on top of the $65 billion already pledged for three chip plants in Arizona, announced alongside Trump at the White House.
Taiwan Semiconductor will report second-quarter earnings Thursday and issue third-quarter guidance.
Price Action: TSM stock is trading higher by 3.30% to $236.22 at last check Tuesday.
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