Taiwan Semiconductor Strengthens Its Position as Leading Chipmaker

Taiwan Semiconductor Manufacturing Co, often referred to as TSM, has successfully reinforced its status as the leading player in the global wafer foundry business during the third quarter of 2024.

According to reports from TrendForce published by the Taipei Times, TSM saw its market share increase to 64.9%, up from 62.3% in the second quarter of 2024. This growth positions TSM significantly ahead of its competitor, Samsung Electronics Co, particularly as the demand for flagship smartphones and high-performance computing (HPC) devices continues to rise.

In the third quarter, TSM reported impressive topline growth, achieving a revenue of $23.5 billion, which marks a 39% increase compared to previous periods.

This stellar performance can be largely attributed to the enhanced utilization of production capacity and a boost in wafer shipments, which enabled TSM to outpace its rivals in the industry.

Demand for advanced 3nm technology, driven by clients such as Apple Inc, alongside growth in AI-related sectors, played a critical role in this surge. According to analyst Charles Shi from Needham, the substantial demand in the smartphone and AI markets has been crucial for TSM's strong performance in 3nm and 5nm technologies.

On the other hand, Samsung has faced increased competition from emerging Chinese rivals in advanced technology, causing its market share to decline to 9.3% from 11.5% in the previous quarter.

Overall, the combined sales of the top wafer foundry operators reached $34.9 billion in the third quarter, reflecting a sequential growth of 9.1% driven by the growing adoption of 3nm processes.

China's Semiconductor Manufacturing International Corp (SMIC) currently ranks third in market share at 6.0%, followed by United Microelectronics Corp (UMC) at 5.2% and GlobalFoundries Inc at 4.8%.

Looking ahead, TrendForce anticipates continued robust global demand for emerging technologies, which is expected to bolster sales among the leading wafer foundry operators in the fourth quarter.

Furthermore, TSM and GlobalFoundries are poised to benefit from U.S. semiconductor subsidies. TSM recently received a $6.6 billion grant to support its semiconductor project in Phoenix, Arizona, while GlobalFoundries secured $1.5 billion for its operations in Malta, New York, and Burlington, Vermont.

Analyst Jack Huang from SinoPac Financial projects a remarkable 20% growth for TSM's business in 2025. This anticipated growth is expected to have a positive impact on the Taiex, Taiwan's stock market index, particularly in the first half of 2025.

Since the beginning of the year, TSM's stock has surged by 99%, attracting investor interest. Those looking to invest can consider options like the VanEck Semiconductor ETF and the Global X Emerging Markets Great Consumer ETF.

As of the latest market data, TSM's stock is trading at $201.20, reflecting a slight decrease of 0.90% on the day.

Photo credit: wakamatsu.h via Shutterstock.

semiconductor, technology, financial