Latest news with #C.C.Wei
Yahoo
a day ago
- Business
- Yahoo
Why Taiwan Semiconductor Stock Popped Today
TSMC told its shareholders it expects to earn a record profit this year. Tariffs could depress demand in the U.S. -- but not demand everywhere. TSMC is confident it can continue growing at 20%-plus annually. 10 stocks we like better than Taiwan Semiconductor Manufacturing › Shares of Taiwan Semiconductor Manufacturing Company (NYSE: TSM) jumped 3% through 2:35 p.m. ET after CEO C.C. Wei told shareholders at the company's annual general meeting that TSMC expects to earn "record profit" in 2025. Of particular interest to investors, Wei said he's "not afraid" that President Donald Trump's tariffs turmoil will keep TSMC from reaching this goal. "The impact of tariffs on TSMC is not direct," Wei said. "Tariffs are paid by importers. However, tariffs will make prices higher and could drag down demand." Regardless, "overall AI demand is still very high" -- indeed, higher than the production capacity to fulfill it. Thus, if U.S. buyers pull back on buying semiconductors manufactured in Taiwan, well, there are always other buyers elsewhere. Long story short, Wei is confident his company can continue growing sales in the mid-20% range despite tariffs threats. Because even if supply eventually meets demand for artificial intelligence applications, new markets are forming to create even more demand for the company's chips. Which markets? "The chip demand for humanoid robots starts now," declared Wei. So demand for TSMC's chips shouldn't be an issue. But should you demand to buy some TSMC stock? Maybe. On the one hand, a mid-20s growth rate compares favorably against a TSMC P/E ratio of only 24, suggesting TSMC stock is cheap. On the other hand, TSMC's free cash flow isn't quite as robust as its reported generally accepted accounting principles (GAAP) earnings suggest. The company reported $39.4 billion profit over the past year, but FCF was only $27.3 billion, meaning TSMC generated cash profit of only about $0.69 for each $1 in claimed profit. With a price-to-free-cash-flow ratio of more than 31, TSMC still seems pricey to me. Before you buy stock in Taiwan Semiconductor Manufacturing, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Taiwan Semiconductor Manufacturing wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $656,825!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $865,550!* Now, it's worth noting Stock Advisor's total average return is 994% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 2, 2025 Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy. Why Taiwan Semiconductor Stock Popped Today was originally published by The Motley Fool
Japan Times
2 days ago
- Business
- Japan Times
TSMC flags delays in Japan expansion while U.S. plans advance
Taiwan Semiconductor Manufacturing Company CEO C. C. Wei blamed worsening traffic snarls for delays in expanding its base in southwest Japan, even while a parallel U.S. effort races ahead. Wei reaffirmed TSMC's commitment to spend another $100 billion to ramp up manufacturing in Arizona over the next half-decade, while saying a plan to build a second plant in Japan was experiencing slight delays. He stressed productive discussions with Donald Trump earlier this year, even after telling the U.S. president it will be "very, very difficult' for TSMC to complete the massive buildout in five years due to a shortage of skilled labor. Trump was "warm' during their exchange, Wei said. The twin projects embody TSMC's impetus to produce abroad as geopolitical tensions rise and demand grows for Nvidia chips essential for developing AI. TSMC has long operated mostly from its home turf of Taiwan but built a plant in Japan after securing a raft of commitments and incentives from Tokyo. It then announced plans to dramatically increase its U.S. investment days after Trump took office. TSMC's first Japan factory, which began operating last year, has been a boon to the local economy. But it's also overwhelming the community's farm-town infrastructure, causing shortages in housing and services and stretching commute times. "We have created too big an impact on the local traffic. I have experienced that in person. For what used to take a 10-15 min drive, it now takes almost an hour,' the CEO told reporters after hosting a shareholders' meeting in Hsinchu, Taiwan, on Tuesday. "We told the Japanese government we'll delay the construction until the traffic improves. They said they'll make improvements as soon as possible.' But Wei did not specify the length of the delay, which he characterized as minor. TSMC said in an emailed statement late Tuesday that it is starting construction of the second plant within this year, reiterating the revised schedule offered by Wei during an earnings conference in April. The world's largest contract chipmaker sits at the heart of that technology supply chain, producing cutting-edge chips for Apple's iPhones and Nvidia's AI servers. Governments from Washington to Brussels have for years courted the company, particularly after shortages of certain types of semiconductors during the pandemic halted production of cars, smartphones, power tools, home appliances and other electronics. TSMC's plan to build a second factory in Kumamoto Prefecture — with construction widely expected to have started in the first quarter of this year — is key to Japan's ambitions to regain leadership in semiconductors and attract engineers to an aging country. The local community has not been able to fully absorb the sudden influx of workers from TSMC's first plant, however, even as the chipmaker's plans in the United States lowers the urgency of production in Japan. "This will become negative for the area, for the local government, but I am most worried it will become negative for local residents,' Wei said. "So we told the Japanese government to improve the traffic first.' In response to Wei's comments, Japan's chief government spokesman Yoshimasa Hayashi said at a regular news conference, "Heightened uncertainty in the global economy, along with challenges including the lack of domestic infrastructure and labor can lead to hesitation among private companies thinking of investing.' Tokyo recognizes the need to create an environment that attracts talent and investment from overseas, he said. The holdup in Japan recalls earlier hitches in getting production up and running at TSMC's newest U.S. facilities in Arizona — though TSMC has made significant headway since. There also remain questions about the longer-term outlook for AI demand. Even before Washington slapped additional tariffs on much of the world — only to roll them back shortly after — investors had questioned whether big tech firms from Microsoft to Meta will continue to buy Nvidia chips and build data centers at the same pace. Executives on Tuesday said demand for AI chips still outstripped supply. Wei reaffirmed the chipmaker was still looking for 2025 revenue growth in the mid-20% range, an outlook it delivered during quarterly earnings calls in April. But the executive also warned that the strengthening Taiwanese dollar was pressuring its margins, even though the company expects record profit this year. TSMC executives have stressed that demand — particularly for high-end chips critical to developing artificial intelligence — has remained resilient. That's helped reassure investors fearful of the Trump administration's escalating campaign to curtail China's tech ambitions and impose sky-high tariffs on goods around the world. For 2025, the market remains nervous about the fallout for the global economy and a sector that supplies critical components to just about every industry on the planet. Taiwan's largest company is also reportedly evaluating building an advanced production facility in the United Arab Emirates. The project — discussed with the Trump administration — is said to be a substantial investment in what's called a gigafab, a complex of six factories similar to what TSMC is building in Arizona. On Tuesday, Wei said TSMC didn't harbor plans to build a chip fab in the region due to a lack of customers there.
Yahoo
3 days ago
- Business
- Yahoo
Taiwan Semiconductor Sees AI Chip Demand Outpacing Supply
Taiwan Semiconductor Manufacturing Company (NYSE:TSM) edged up 1.6% as CEO C.C. Wei told shareholders that, despite U.S. tariffs, AI chip demand far outstrips supply and has not wavered. Wei explained tariffs hit importers, not exporters like Taiwan Semiconductor, so any impact is indirecthigher prices might eventually dampen demand, but AI demand remains very strong and is consistently outpacing supply. He noted no shifts in customer behavior amid tariff uncertainty and expects clarity in coming months. After reporting robust Q1 results in April, Taiwan Semiconductor reaffirmed it expects AI accelerator revenue to double in 2025. Addressing rumors of a Middle East fab, Wei confirmed the company has no plans to build in the UAE. Investors should care because Taiwan Semiconductor's ability to maintain steep pricing and expand AI capacity under tariff pressures underlines its dominance in the semiconductor ecosystemand that supply constraints, not policy, remain the primary limit on growth. With Taiwan Semiconductor guiding for doubled AI accelerator revenue this year, markets will watch capacity-expansion announcements and any future commentary on how tariffs ultimately filter down to customers' budgets. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
3 days ago
- Business
- Yahoo
Taiwan Semiconductor Sees AI Chip Demand Outpacing Supply
Taiwan Semiconductor Manufacturing Company (NYSE:TSM) edged up 1.6% as CEO C.C. Wei told shareholders that, despite U.S. tariffs, AI chip demand far outstrips supply and has not wavered. Wei explained tariffs hit importers, not exporters like Taiwan Semiconductor, so any impact is indirecthigher prices might eventually dampen demand, but AI demand remains very strong and is consistently outpacing supply. He noted no shifts in customer behavior amid tariff uncertainty and expects clarity in coming months. After reporting robust Q1 results in April, Taiwan Semiconductor reaffirmed it expects AI accelerator revenue to double in 2025. Addressing rumors of a Middle East fab, Wei confirmed the company has no plans to build in the UAE. Investors should care because Taiwan Semiconductor's ability to maintain steep pricing and expand AI capacity under tariff pressures underlines its dominance in the semiconductor ecosystemand that supply constraints, not policy, remain the primary limit on growth. With Taiwan Semiconductor guiding for doubled AI accelerator revenue this year, markets will watch capacity-expansion announcements and any future commentary on how tariffs ultimately filter down to customers' budgets. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Business
- Yahoo
AI Demand Explodes--but TSMC Warns of Risks Investors Can't Ignore
TSMC (NYSE:TSM), the world's top chip foundry, is walking a tightropenavigating rising U.S. tariffs, political headwinds, and China's growing aggression toward Taiwan. But even with those risks looming, the company says it's still chasing down AI demand that refuses to cool off. At the annual shareholder meeting in Hsinchu, CEO C.C. Wei told investors that while tariffs could nudge prices higher and chip demand lower, TSMC hasn't seen customer orders drop off. In his words: AI demand has always been very strongand it's consistently outpacing supply. That surge in demand could be what's keeping the floor under TSMC's growth story. Wei doubled down on the chipmaker's bullish 2025 outlook, citing robust orders tied to AI use caseswhere companies like Apple and Nvidia continue to lean heavily on TSMC's most advanced nodes. He noted that TSMC's top priority right now is simply producing enough chips to meet that growing appetite. Working hard, Wei said, is code for we still don't have enough. He also dismissed rumors of a UAE factory, and confirmed the company is staying tightly aligned with U.S. and Taiwanese regulationsespecially after suspending shipments to Sophgo, a Chinese chip firm under scrutiny due to its links to Huawei's AI silicon. Still, long-term investors aren't just watching the supply chainthey're eyeing the map. With geopolitical tensions flaring across the Taiwan Strait, the question isn't just about chips anymoreit's about continuity. Wei kept his response diplomatic, stating that such scenarios are a matter for governments, not for TSMC alone. That may be true. But for now, TSMC remains one of the biggest leverage points in the global AI boomand while the road ahead isn't without bumps, demand could continue driving momentum even through turbulence. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data
