Key contract chipmaker Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM) is set to post another record quarter as strong AI-driven demand and tight chip supply continue to fuel growth, according to analysts.

Record Profit Growth Driven By AI Demand

Analysts estimate Taiwan Semiconductor will post a roughly 50% jump in first-quarter net profit, marking a fourth straight record period, as demand for AI infrastructure continues to surge.

Forecasts compiled by LSEG point to net income of about 542.6 billion New Taiwanese dollars, while any result above 505.7 billion New Taiwanese dollars would set a new quarterly high and extend its profit growth streak, Reuters reported on Monday.

Advanced Chip Demand Outpaces Supply

Experts say demand for advanced technologies—especially 3-nanometer chips and packaging used in AI processors—continues to exceed supply.

Arthur Lai, head of technology research for Asia at Macquarie Capital, said he expects stronger quarter-on-quarter revenue guidance for the second quarter, driven by ongoing AI demand and Taiwan Semiconductor’s leadership in advanced nodes.

Resilience And Valuation Upside In Focus

Despite geopolitical risks tied to the Middle East, analysts believe Taiwan Semiconductor remains resilient. Galen Zeng, senior ​research manager at IDC, said the company’s diversified sourcing and inventory buffers should help it manage short-term disruptions, while also noting that future capital spending decisions will signal management’s confidence in long-term AI demand.

Separately, Bank of America Securities raised its price target on Taiwan Semiconductor and maintained a Buy rating, citing strong demand for high-performance computing, full utilization of 3-nanometer capacity, and customers’ willingness to pay premium prices.

Technical Analysis

At $367.50, TSM is trading 7.5% above its 20-day simple moving average (SMA), the stock’s average price over the last 20 sessions, which suggests buyers have kept the short-term trend pointed up despite the premarket pullback. It’s also trading 12.1% above its 100-day SMA, indicating the intermediate trend is still tilted higher.

Moving average convergence divergence (MACD), a trend/momentum measure, is bullish with the MACD line at 3.1588 versus a -1.2852 signal line, which is consistent with upside momentum still having an edge. The key question for traders is whether that momentum can persist as the stock sits not far below the $390.00 area that has acted as resistance.

  • Key Resistance: $390.00 — where rallies have recently stalled near the 52-week high zone
  • Key Support: $332.00 — an area buyers have previously defended after pullbacks

Earnings & Analyst Outlook

The countdown is on: Taiwan Semiconductor is set to report earnings on April 16, 2026 (confirmed).

  • EPS Estimate: $3.29 (Up from $2.12 YoY)
  • Revenue Estimate: $35.50 Billion (Up from $25.53 Billion YoY)
  • Valuation: P/E of 35.2x (Indicates premium valuation relative to peers)

Analyst Consensus & Recent Actions: The stock carries a Buy Rating with an average price target of $401.67. Recent analyst moves include:

  • DA Davidson: Initiated with Buy (Target $450.00) (February 13)
  • Barclays: Overweight (Raises Target to $450.00) (January 16)
  • TD Cowen: Hold (Raises Target to $370.00) (January 16)

Top ETF Exposure

  • Lazard Emerging Markets Opportunities ETF (NYSE:EMKT): 7.19% Weight
  • Invesco FTSE RAFI Emerging Markets ETF (NYSE:PXH): 6.23% Weight
  • Dan IVES Wedbush AI Revolution ETF (NYSE:IVES): 5.81% Weight

Significance: Because TSM carries such a heavy weight in these funds, any significant inflows or outflows will likely trigger automatic buying or selling of the stock.

Price Action

TSM Stock Price Activity: Taiwan Semiconductor shares were down 0.70% at $368.01 during premarket trading on Monday, according to Benzinga Pro data.

Photo via Shutterstock