TSM briefing — Taiwan Semiconductor Manufacturing Company Limited

Released: 2026-04-27 Briefing series: #1 of N Prior briefing: first in series Stock at release: $404.98 Inflection pattern: volatile_grower

What changed since the last briefing

(This is the first briefing in the series.)

Company snapshot

• Ticker: TSM
• Name: Taiwan Semiconductor Manufacturing Company Limited
• What they do: TSMC is the world's largest dedicated contract semiconductor foundry, manufacturing chips designed by third-party fabless companies (Apple, NVIDIA, AMD, Qualcomm, and others) across advanced nodes from 2nm through mature nodes, using both its proprietary processes and customer-specific technology. (20-F FY2025, filed 2026-04-16)
• IPO date: Listed on NYSE as ADR in 1997; first candle in data: 2021-04-28
• Market cap at release: ~$2.1T (25.9B shares outstanding at NT$31.37/USD × $404.98 per ADS, each representing 5 common shares — ADR holders own ~5.18B ADS × $404.98)
• Sector / Industry: Technology / Semiconductor Foundry
• HQ: Hsinchu Science Park, Hsinchu, Taiwan, Republic of China
• CEO / Founder status: C.C. Wei, CEO — professional management; Morris Chang is founder (retired). Wendell Huang is CFO. (6-K, filed 2026-04-16)
• Profitable?: Yes — net income attributable to shareholders NT$1,697,604M (~US$54.1B) in FY2025 under IFRS; basic/diluted EPS NT$65.47. (6-K, filed 2026-04-16)
• Total shares outstanding: ~25.9B common shares; each ADS represents 5 common shares (~5.18B ADSs)
• Fiscal year end: December

The arc

| Date | Event | Source | |------|-------|--------| | 2026-04-24 | TSM stock hit record high after Taiwan loosened fund investment limits; Taiex rose 3.3%; stock +4.9% on the day. | Multiple / event data, 2026-04-24 | | 2026-04-16 | Q1 2026 earnings: Q1 profit surged amid AI demand; 2026 outlook raised. Stock -2.7% on the day despite beat, likely on "sell the news." TSMC also unveiled new A13 and N2U chip manufacturing technology. | Event data / 6-K, 2026-04-16 | | 2026-04-16 | 20-F FY2025 filed: confirmed 2025 IFRS net income of NT$1,697,604M (~US$54.1B); total assets NT$7,932,843M. TSMC Global Ltd. subsidiary approved capital increase of up to US$30B from parent (February 2026). | 6-K, filed 2026-04-16; 6-K, filed 2026-02-10 | | 2026-02-10 | Directors' resolution at TSMC Global Ltd. (subsidiary) approved capital increase of up to US$30B from TSMC parent, subject to regulatory approvals — reflects major U.S. fab expansion investment. | 6-K, filed 2026-02-10 | | 2026-01-28 | January 2026 U.S.-Taiwan trade agreement announced; preferential Section 232 treatment for Taiwanese semiconductor producers investing in U.S. manufacturing. Supports TSMC Arizona fab economics. | 20-F FY2025, filed 2026-04-16 | | 2025-12-01 | U.S. Section 232 investigation concluded; 25% ad valorem tariff imposed on certain advanced computing chips and derivative products, with potential tariff offset for U.S. domestic manufacturers. | 20-F FY2025, filed 2026-04-16 | | 2024-01-01 | TSMC began high-volume production at its first U.S. fab in Phoenix, Arizona (Fab 21 Phase 1, using 4nm process). | Industry consensus / 20-F references | | 2023-01-01 | TSMC commenced volume production of 3nm (N3) process; advanced nodes (7nm and below) represented the majority of wafer revenue. | 20-F FY2025 (references to historical technology ramp) |

Current state

Year-over-year changes (FY2024 → FY2025)

| Metric | FY2024 | FY2025 | Change | |--------|--------|--------|--------| | Net income attributable to shareholders (NT$M) | [DATA NEEDED — 20-F FY2024] | 1,697,604 | [DATA NEEDED] | | Net income attributable to shareholders under Taiwan-IFRS (NT$M) | [DATA NEEDED] | 1,717,883 | [DATA NEEDED] | | Basic/diluted EPS (NT$) | [DATA NEEDED] | 65.47 | [DATA NEEDED] | | Total assets (NT$M) | [DATA NEEDED] | 7,932,843 | [DATA NEEDED] |

Source: 6-K, filed 2026-04-16. Full year-over-year comparison requires 20-F FY2025 financial tables — the 20-F summary in available data contains only the first 201 lines (risk factors). Comparative FY2024 figures are [DATA NEEDED] pending full 20-F review.

TSMC's Q1 2026 earnings (reported April 2026) showed profit surging amid AI demand; management raised 2026 guidance. The company is the critical manufacturing node for leading AI chip designers including NVIDIA, AMD, and Apple. Revenue from 3nm and below chips accounted for 53% of quarterly wafer revenue in Q1 2026 per industry reports. (Event data, 2026-04-16.)

For FY2025, TSMC under IFRS reported net income attributable to shareholders of NT$1,697,604M (~US$54.1B at the December 31, 2025 exchange rate of NT$31.37:US$1). Under Taiwan-IFRS (the primary reporting basis), net income attributable to shareholders was NT$1,717,883M, basic EPS NT$66.26. The primary difference between the two bases was timing of recognition of R.O.C. tax on unappropriated earnings. Total assets under IFRS were NT$7,932,843M (~US$252.9B); total equity attributable to shareholders of the parent was NT$5,355,039M (~US$170.7B). (6-K, filed 2026-04-16.)

TSMC's capital allocation is heavily focused on expanding U.S. manufacturing. The TSMC Global Ltd. subsidiary approved a capital increase of up to US$30B from the TSMC parent (6-K, filed 2026-02-10). Arizona Fab 21 Phase 1 (4nm) is operational; Phase 2 (2nm) is under construction with volume production expected in 2028. TSMC is also building fabs in Japan (熊本, Kumamoto) and is in discussions regarding Germany (Dresden). These geographic expansions are in response to customer and government demand for supply chain resilience.

The U.S. tariff environment remains the most significant macro risk. The Supreme Court struck down IEEPA-based reciprocal tariffs in February 2026, but the U.S. replaced them with Section 122 tariffs and initiated Section 301 investigations targeting Taiwan. A January 2026 U.S.-Taiwan trade agreement granted preferential Section 232 treatment for Taiwanese producers investing in U.S. manufacturing, which benefits TSMC Arizona's economics. However, residual tariff uncertainty and potential further U.S. trade actions remain live risks. (20-F FY2025, filed 2026-04-16.)

Key numbers

| Metric | FY2022 | FY2023 | FY2024 | FY2025 | |--------|--------|--------|--------|--------| | Net income (IFRS, NT$M) | [DATA NEEDED] | [DATA NEEDED] | [DATA NEEDED] | 1,697,604 | | Net income (Taiwan-IFRS, NT$M) | [DATA NEEDED] | [DATA NEEDED] | [DATA NEEDED] | 1,717,883 | | EPS basic (Taiwan-IFRS, NT$) | [DATA NEEDED] | [DATA NEEDED] | [DATA NEEDED] | 66.26 | | Total assets (IFRS, NT$M) | [DATA NEEDED] | [DATA NEEDED] | [DATA NEEDED] | 7,932,843 |

Source: 6-K, filed 2026-04-16. Full multi-year financial table [DATA NEEDED] — requires complete 20-F FY2025 review. Revenue, operating margin, and gross margin figures not available in summary data.

Recent news (last 6 months)

| Date | Headline | Source | Market reaction | |------|----------|--------|-----------------| | 2026-04-24 | TSMC hits record high after Taiwan loosens fund investment limits; Taiex +3.3% | Multiple | +4.9% | | 2026-04-16 | Taiwan Semi raises 2026 outlook after Q1 profit surges amid AI demand | IBD / Multiple | -2.7% | | 2026-04-15 | Stock falls -5.4% day ahead of earnings — likely pre-earnings nervousness | Multiple | -5.4% | | 2026-04-08 | Citi remains bullish on TSM, growing AI-driven chip demand | Citi / event data | +2.7% | | 2026-03-24 | TSMC hitting production capacity limits, says Broadcom | IBD | +2.5% | | 2026-03-25 | TSM vs. AVGO — which is better semiconductor stock? | Yahoo Finance | -3.8% | | 2026-03-12 | TSMC reports Feb 2026 revenue data | Yahoo Finance | -2.5% | | 2026-02-23 | TSMC stock extended re-rating after 95% one-year surge | Multiple | +4.4% | | 2026-02-10 | TSMC stock hits record high as chip foundry posts strong sales | IBD | +5.5% |

Open questions

1. Revenue and operating margin disclosure: The 20-F FY2025 summary available in filing data (201 lines) contains only risk factors. Revenue, gross margin, and operating margin for FY2025 are not confirmed in available data. The 6-K filed April 16, 2026 only discloses IFRS vs. Taiwan-IFRS net income differences. Full P&L requires review of the complete 20-F or the Taiwan-IFRS consolidated financial statements filed as Exhibit 99.1 of the February 26, 2026 6-K.

2. Arizona Fab 21 Phase 2 economics: Phase 2 uses 2nm process, targeted for high-volume production in 2028. Capital cost for the Arizona expansion was not disclosed in available data, but TSMC Global Ltd.'s US$30B capital increase authorization (6-K, filed 2026-02-10) likely funds a material portion. What are the expected utilization timelines, customer commitments, and margin profiles for Phase 2 vs. Taiwan operations? Verify in full 20-F or Q1 2026 earnings call transcript.

3. Wafer price adjustment at UMC and TSMC: Reports from April 2026 suggested UMC announced upcoming wafer price adjustments, driving a broad-based foundry sector rally (event data, 2026-04-19). Whether TSMC similarly adjusted pricing — and what the magnitude and timing were — is a key margin driver. (Event data cross-referenced; verify in Q1 2026 earnings call.)

4. TSMC debuting A13 and N2U: TSMC unveiled new A13 and N2U chip manufacturing technology on April 22, 2026, the same day ASML disclosed TSMC is delaying high-NA EUV adoption. N2U is an enhanced version of N2 with better performance and density; A13 appears to be an angstrom-class process. What does this new technology roadmap mean for ASML's EXE high-NA tool deployment plans? (Event data, 2026-04-16; Investing.com, 2026-04-22.)

5. China exposure: The 20-F risk factors describe risks from U.S. Section 301 investigations targeting Taiwan and the January 2026 tariff framework. TSMC's China revenue exposure (wafer shipments destined for Chinese end-customers) is a key regulatory risk area. Verify in full 20-F geographic revenue breakdown.

Red flags / things to verify

• 20-F summary truncation: The TSM 20-F FY2025 summary file available in data is 201 lines containing only risk factors. Revenue, operating income, gross margin, and share count for FY2025 require the full 20-F on SEC EDGAR or the Taiwan-IFRS financials in the February 26, 2026 6-K exhibit. All financial figures cited here are from the April 16, 2026 6-K net income reconciliation only.

• Tariff and trade uncertainty is active: The 20-F FY2025 (filed 2026-04-16) explicitly states the Supreme Court's February 2026 ruling striking down IEEPA reciprocal tariffs, replacement Section 122 tariffs, new Section 301 investigations targeting Taiwan, and ongoing uncertainty about preferential Section 232 treatment. These are live regulatory risks requiring quarterly monitoring. Any new tariff action on Semiconductor Items could materially affect TSMC's U.S. customer economics and order flow.

• Geopolitical concentration risk: Substantially all of TSMC's manufacturing is concentrated in Taiwan. A military conflict, earthquake, or power disruption affecting Taiwan operations would affect the global semiconductor supply chain. The risk is disclosed prominently in the 20-F FY2025. Geographic diversification (Arizona, Japan) addresses this partially but over a multi-year timeline.

• Taiwan-IFRS vs. IFRS net income difference: The difference between Taiwan-IFRS net income (NT$1,717,883M) and IFRS net income (NT$1,697,604M) — a gap of NT$20,279M (~US$646M) — was attributed to "timing of recognition of R.O.C. tax on unappropriated earnings" (6-K, filed 2026-04-16). Verify whether this timing difference reverses in FY2026 and what the cash tax impact is.

Sources

• 20-F (FY2025): Filed 2026-04-16 — https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=TSM&type=20-F&dateb=&owner=include&count=10
• 20-F (FY2024): Filed 2025-04-17 — SEC EDGAR
• 6-K (IFRS vs. Taiwan-IFRS reconciliation, FY2025): Filed 2026-04-16 — SEC EDGAR
• 6-K (TSMC Global Ltd. capital increase): Filed 2026-02-10 — SEC EDGAR
• 6-K (Taiwan-IFRS consolidated financial statements FY2025): Filed 2026-02-26, Exhibit 99.1 — SEC EDGAR
• 6-K (Q3 2025 dividend adjustment): Filed 2026-03-02 — SEC EDGAR