Taipei: Taiwan Semiconductor Manufacturing Co. (TSMC) has announced a significant revision to its 2026 sales growth forecast, now expecting an increase of over 40% in U.S. dollar terms due to strong global demand for AI applications. The update was shared by TSMC Chairman C.C. Wei during an investor conference, highlighting the impact of the AI boom on the company's financial outlook.
According to Focus Taiwan, Wei noted the challenges posed by a price surge in electronic components and uncertainties in the microelectronics sector, which have affected the consumer electronics market. Despite these hurdles, TSMC remains optimistic about its growth prospects, marking the second time this year it has upgraded its sales guidance. Earlier, in mid-April, the company had projected a 30% growth in U.S. dollar terms for 2026, up from an initial estimate in January.
At the conference, TSMC's Chief Financial Officer Wendell Huang provided further insights, forecasting third-quarter sales to fall between US$44.6 billion and US$45.8 billion, with a median increase of 12% from the second quarter. Despite a slight dip in the expected gross margin to 65-67% from 67.7% in the previous quarter, TSMC remains confident in its strategy to capitalize on the AI era.
To support the growing demand for 5G, AI applications, and high-performance computing devices, TSMC plans to increase its capital expenditure significantly. Huang revealed that the company has adjusted its capex plan to a range of US$60.0 billion to US$64.0 billion for 2026, up from the previous US$52.0 billion to US$56.0 billion range set in April. Approximately 70-80% of this budget will be directed towards advanced process development, with the remainder allocated to specialty technology development and high-end IC assembly and testing.
The expanded capex is expected to accelerate TSMC's growth trajectory in the coming years, aiming to deliver substantial returns to shareholders. TSMC's strategic investments position it ahead of its peers in technology development, ready to meet the demands of emerging 5G, AI, and HPC applications.
According to TSMC, the company's capital expenditure reached US$15.7 billion in the second quarter, marking a 41.4% increase from the first quarter and a 63% rise from the previous year. For the first half of the year, TSMC's capex totaled US$26.8 billion, reflecting a 36% year-on-year increase.