The year 2026… another turning of the wheel, another promise whispered on the wind. They speak of artificial intelligence blossoming, a digital spring after a long, calculating winter. The hyperscalers, those vast, unseen gardens of computation, are preparing the soil, investing fortunes in their ambitions. And amidst this grand choreography, one name echoes with a peculiar resonance: Taiwan Semiconductor Manufacturing, or TSMC. A foundry, yes, but also a kind of silent architect of this new age.
To speak of reasons to “buy” is to reduce the matter to a crude transaction. It is as if one were to quantify the turning of the seasons. Still, the currents flow, and one must acknowledge their direction. Let us consider, then, not reasons for acquisition, but observations of a certain… solidity, a certain momentum within this enterprise.
A Growth, Measured in Light
The most recent accounting reveals a growth, certainly. The fourth quarter of 2025 yielded figures that, while impressive to some, feel more like the inevitable consequence of a world increasingly reliant on these minuscule engines of logic. Observe:
| Metric | Q1 ’25 | Q2 ’25 | Q3 ’25 | Q4 ’25 |
|---|---|---|---|---|
| Sales growth (YoY) | 35% | 44% | 41% | 26% |
A full year’s increase of 36%, they say. And a projection of 30% for the year to come. These numbers possess a certain… weight, like stones gathered at the river’s edge. Management speaks of a compound annual growth rate of 25% through 2029. A considerable ambition, given the scale of the operation—$122 billion in revenue for 2025. It is as if a great ship, already immense, were attempting to accelerate further, defying the natural resistance of the water.
Profit & the Delicate Balance
TSMC is, at its core, a business of capital intensity. It consumes resources—land, energy, expertise—at a prodigious rate. And yet, it yields profit. A high gross margin—expanding from 59% to 62.3%—suggests a discipline, a careful stewardship of these resources. An operating margin of 54%, a similar ascent from 49%. It is a delicate balance, this dance between investment and return, a constant striving for equilibrium.
They foresee a gross margin of 63-64% in the coming quarter, sustained above 56% long-term. And an operating margin between 54-56%. These projections are not guarantees, of course. The future is a shifting landscape, obscured by mist and shadow. But they offer a glimpse of a certain… stability, a certain confidence in the face of uncertainty.
The AI Current & the Rising Tide
To frame TSMC solely as an “AI play” is to diminish its scope. It is more accurate to say that AI is merely one tributary flowing into a much larger river. High-performance computing, the segment encompassing this digital blossoming, accounted for 58% of revenue in 2025, growing 48% year over year. A significant proportion, certainly, but not the entirety of the picture.
Capital expenditures reached $41 billion in 2025, up from $30 billion the previous year. Management speaks of increased capex correlating with opportunity. A logical assertion, perhaps, but one that carries a certain… risk. Investing in potential is akin to planting seeds in barren soil. There is no guarantee of a harvest. They plan to raise capex to $54 billion in 2026, with 70-80% dedicated to “advanced process technologies.” The market, predictably, anticipates further growth. A rising tide, they say, lifts all boats. But it also obscures the rocks beneath the surface.
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2026-01-24 23:54