Taiwan Semiconductor Manufacturing Co posted a 60 percent increase in monthly sales, reflecting the company booming semiconductor demand as the AI buildout continues. The figure, carried in Wednesday market reporting, shows that the demand for advanced chips has not slowed even as the stocks of AI companies have fallen and investors have questioned the buildout.
Why it matters
TSMC is the foundry that makes the chips for almost every AI company, so its sales are the most direct read on real demand in the sector. When Nvidia, AMD and the cloud providers order more wafers, TSMC revenue rises first, and a 60 percent jump says the orders are still coming. The Reuters Tankan sentiment index for Japanese manufacturers also rose to 27 in November from 22, supported by booming semiconductor demand. Nvidia earnings next week will be the next big test, and strong results could ease concerns about earnings prospects for AI and semiconductor companies.
The contrast with the market could hardly be sharper. Nvidia shares have fallen for two days, wiping about 430 billion dollars off its value, SoftBank posted a 7 billion dollar loss on its data centre bets, and the Nasdaq sits in correction territory. But the foundry numbers say the hardware is still selling, and the gap between the stock prices and the sales is the debate of the week.
What happens next
The wider Asian market agreed with TSMC. Japan Nikkei rose for a third straight session, up 0.80 percent to 60,942.48, and AI related stocks rose up to 9 percent in India as the Anthropic IPO and CoreWeave earnings lifted sentiment. The demand story is winning in Asia, even as the valuation story is losing in New York.
What happens next will be decided by Nvidia earnings next week, the next big test of AI demand. If the chipmaker reports the same strength as TSMC, the selloff will look like a buying opportunity. If it disappoints, the foundry numbers will look like the last good news before the slowdown. For now, the chips are selling. The Reuters Tankan sentiment index for Japanese manufacturers rose to 27 in November from 22, and the Nikkei rose for a third straight session on the same demand.
