Tesla's Samsung order shift unlikely to hurt TSMC: Morgan Stanley
'We see limited impact to our TSMC EPS assumptions from 2027 and we don't expect TSMC stock to de-rate because of Tesla (NASDAQ:TSLA) shifting some orders to Samsung Foundry,' analysts wrote.
Tesla recently signed a $16.5 billion chip deal with Samsung, with the new AI5 chip, set to launch in January 2026, still being manufactured using TSMC's 3nm process.
Morgan Stanley noted that the AI5 is expected to deliver four to five times the performance of its predecessor and will continue production through 2026.
Although the AI6 chip will reportedly shift to Samsung in 2027 using a 2nm process, the bank estimates this represents only about a 1% revenue loss for TSMC.
'Strategically, we would never assume TSMC can acquire 100% market share in the leading edge,' Morgan Stanley said, citing common practices of using multiple foundry partners for pricing and engineering flexibility.
Moreover, the firm expects TSMC to continue supplying Tesla and x.AI's cloud AI chips.
'We are also seeing a 3nm AI ASIC from x.AI to be produced in 2026 through TSMC's design service partner GUC,' analysts noted, estimating those cloud AI chips could add 0.5% to 2027 revenue.
Morgan Stanley also highlighted longer-term growth potential in China's smart and AI vehicle market, calling it 'a viable long-term growth driver for TSMC.'
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