Taiwan Semiconductor Manufacturing Co.’s revenue climbed 39% in the first two months, quickening from 2024 in a sign of resilient demand for the Nvidia Corp. chips that power AI development.

The world’s largest chipmaker reported combined revenue for the first two months of NT$553.3 billion ($16.8 billion). That compares with 34% growth during the full-year of 2024. Analysts on average are projecting growth of about 41% this quarter.

As the manufacturer of most of the AI chips in the world, TSMC’s sales are a barometer for the sector. Wall Street and Silicon Valley are now debating the sustainability of an AI frenzy that made Nvidia the world’s most valuable company, especially after China’s DeepSeek appeared to demonstrate a more frugal approach.

What Bloomberg Intelligence Says

Taiwan’s robust growth in integrated circuit exports in January imply AI chip sales are driving up TSMC’s revenue, export data show. While 300-mm silicon wafer shipments signal a recovery, 200-mm wafers appear to reflect weaker automotive and industrial demand. Electric components need an order pickup from consumer-device companies.

- Masahiro Wakasugi and Takumi Okano, analysts

Last week, Broadcom Inc. became the latest big tech firm to offer reassurance that spending on artificial intelligence computing remains healthy. Before that, Taiwanese bellwether Hon Hai Precision Industry Co. posted a 25% rise in revenue during the first two months of 2025, also accelerating from last year.

One major uncertainty TSMC faces in 2025 is whether US President Donald Trump will slap tariffs on chip imports. TSMC may’ve benefited from front-loading or stockpiling ahead of that potential move. Last week, the Taiwanese company’s chief executive joined Trump in the White House to outline an additional $100 billion investment — one of the largest outlays by a foreign firm in US manufacturing.

The move was widely viewed as intended to stave off tariffs, though it raised concerns that advanced technology could be moving away from Taiwan.

Bloomberg Intelligence credit analyst Cecilia Chan pointed out in a report that the $100 billion additional investment announcement would not impact TSMC’s credit ratings as it has a record-high net cash position of $44 billion.

But it could lengthen the break-even time and impact margins further if CHIPS Act funding was cut off, which Trump has called for.