Taiwan Semiconductor (TSM) Stock: October Revenue Growth Hits Two-Year Low

TLDR

• TSMC October revenue reached $11.86 billion, up 16.9% year-over-year but marking the weakest growth since February 2024
• Growth decelerated sharply from September’s 31.4% pace, sparking fresh debate about AI spending sustainability
• Nvidia CEO Jensen Huang requested more chip production from TSMC, saying demand continues strengthening month by month
• TSMC stock gained nearly 3% in premarket trading despite concerns about stretched technology valuations
• Year-to-date revenue through October climbed 33.8% to $3.13 trillion compared to the prior year

Taiwan Semiconductor Manufacturing posted October revenue of NT$367.47 billion, equal to approximately $11.86 billion. The result represents a 16.9% increase from October 2024.

Taiwan Semiconductor Manufacturing Company Limited, TSM

However, the growth rate slowed dramatically from September’s 31.4% year-over-year gain. Bloomberg reported this marks the chipmaker’s weakest annual growth since February 2024.

Revenue climbed 11% from September on a month-over-month basis. From January through October, TSMC generated NT$3.13 trillion in total revenue, up 33.8% from the same period last year.

The company serves as the primary chip supplier for Nvidia and other AI hardware manufacturers. This relationship has fueled much of TSMC’s stock performance over the past three years.

Nvidia Pushes for Increased Production

Nvidia CEO Jensen Huang attended TSMC’s annual sports day event over the weekend. He revealed that he had requested additional chip production capacity from the Taiwan-based manufacturer.

The comments suggest robust AI chip demand continues despite recent market volatility. Companies worldwide are still building data centers and server infrastructure for AI applications.

When TSMC reported third-quarter earnings in mid-October, management guided fourth-quarter revenue between $32.2 billion and $33.4 billion. The guidance midpoint implies roughly 22% annual growth for the quarter.

Stock Rebounds Despite Valuation Worries

TSMC shares jumped nearly 3% in Monday’s premarket session. Nvidia stock also climbed more than 3% during the same trading window.

The gains came after a rough week for technology stocks. The Nasdaq Composite fell 3% last week, recording its worst weekly decline since early April.

Goldman Sachs CEO David Solomon recently stated that “technology multiples are full” at a Hong Kong investment summit. His remarks reflect growing concern among institutional investors about inflated tech valuations.

Short seller Michael Burry recently took large positions betting against both Nvidia and Palantir. His moves have intensified speculation about a potential AI bubble.

Retail traders on Stocktwits shifted their sentiment on TSMC from neutral to bearish. One user noted that “cracks are already starting to show” in the AI growth story.

Recent Sales Data Fuels Debate

The October revenue figures provide fresh ammunition for both bulls and bears. Supporters point to continued double-digit growth and strong customer demand from companies like Nvidia.

Critics highlight the sharp deceleration in growth rates as evidence that AI spending may be peaking. The drop from 31.4% to 16.9% in just one month raises questions about momentum.

TSMC’s year-to-date performance remains strong, with revenue up nearly 34% compared to last year. The company continues benefiting from the global push to expand AI computing infrastructure.

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