To The Moon

I'm incredibly excited about TSMC's $Taiwan Semiconductor Manufacturing(TSM)$   record profits for Q3 2025, and I remain bullish on the company. With a net profit of NT$452.3 billion, up 39.1% from NT$325.26 billion last year, it's clear that TSMC is capitalizing on strong demand across multiple sectors. The 30.3% revenue growth to NT$9,899.2 billion and a record-high gross margin of 59.5%—well above the expected 57.1%—demonstrate the company's robust financial health and operational efficiency. This performance solidifies my confidence in TSMC's leadership in the semiconductor industry.

Looking at the business segments, I see even more reasons for optimism. The 20% growth in IoT and 19% in smartphone revenues, alongside a stable high-performance computing sector, show a diversified and resilient portfolio. The advanced manufacturing processes are a key driver, with 3nm and 5nm chips accounting for 23% and 37% of wafer sales respectively, and 74% of total wafer revenue coming from 7nm and more advanced nodes. This technological edge, supported by a hefty capital expenditure of $29.39 billion in the first nine months, convinces me that TSMC is well-positioned for future growth.

As for guidance on the semiconductor cycle, I'm encouraged by TSMC's outlook. They've raised their 2025 revenue growth forecast to around 35% in USD terms, up from 30%, and expect Q4 sales between $32.2 billion and $33.4 billion, surpassing the $31.23 billion analyst estimate. With projected gross margins of 59%-61% and operating margins of 49%-51%, both beating expectations, I believe TSMC is signaling a strong continuation of the current upcycle. Their planned capital expenditure of $40-42 billion for 2025 further underscores their commitment to meeting this demand.

The surge in ASML's $ASML Holding NV(ASML)$   orders, fueled by billions in AI investments, also boosts my bullish stance. ASML's €5.4 billion ($6.3 billion) in bookings, exceeding the €4.9 billion analyst forecast, reflects the massive demand for chip-making machines, which directly benefits TSMC as a key customer. This synergy suggests that the AI-driven market is still thriving, and TSMC's role in supplying chips for these technologies keeps it at the forefront. I see this as a clear indicator that chip stocks, especially TSMC, are back in action.

In summary, I view TSMC's record profits as a testament to its strategic focus and market leadership, and I'm confident they'll continue to guide the semiconductor cycle upward. The ongoing AI boom, supported by their advanced processes and solid financials, convinces me that the market remains hot. I'm holding firm in my bullish outlook and expect TSMC to deliver even more impressive results in the quarters ahead.

As a retail investor, I focus mainly on the US and Singapore markets, combining a mix of technical trading and long-term investing strategies. I enjoy analyzing charts, spotting patterns, and making calculated moves based on both market sentiment and fundamentals. While I'm not a professional, I treat my portfolio seriously and continue to learn and grow with each trade. If you're also navigating the markets and enjoy discussing stocks, options, or market trends, feel free to follow me. Let's learn and grow together as a community.

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