As artificial intelligence infrastructure continues to expand, TSMC is seen as a key beneficiary of this wave of demand growth. As the world's largest contract chipmaker, TSMC relies on its advanced process technology to produce chips for products including NVIDIA GPUs and Apple smartphones. U.S. investment outlet The Motley Fool noted that if AI demand remains strong, TSMC still has room to substantially increase its market value by 2030.
Strong Growth Momentum for AI Chips
TSMC previously estimated that AI chip sales will grow at a compound annual growth rate of more than 50% from 2024 to 2029. Chairman C.C. Wei said on a recent earnings call that market demand is extremely strong and the actual growth rate could be even higher. Some chipmakers are also upbeat that demand will stay elevated in 2030 to 2031, suggesting AI-related demand could continue and support TSMC's medium- to long-term growth.
High-Performance Computing Accounts for 70%
By business mix, about 70% of TSMC's business in Q3 came from high-performance computing, including AI-related products; smartphones accounted for about 20% and other segments for about 10%. The development of the high-performance computing business will be a key factor affecting TSMC's future growth. As AI applications expand, changes in that share are drawing close market attention.
Expanding U.S. Footprint to Diversify Production
On its overseas footprint, TSMC has invested in fabs in Arizona and committed US$265 billion to expand U.S. chip production capacity. The Motley Fool said the move helps expand capacity and diversify chip production locations, helping to address global customer demand and supply-chain adjustments.
Scenario Points to Nearly 3x Market Value by 2030
Motley Fool analyst Keithen Drury laid out a growth scenario assuming 35% annual growth in total revenue, using analysts' expected 2027 growth rate of 38% as a reference. On profitability, TSMC's profit margin reached 51% in recent months, with the scenario estimated at 50%, putting 2030 revenue at about US$518 billion and profit at about US$259 billion. If the price-to-earnings ratio falls from the current level of about 28 times to 25 times, the market value could reach US$6.5 trillion, nearly 3 times the current level of about US$2.2 trillion, with a US$5,000 investment now potentially growing to about US$15,000 by 2030.