Taiwan Semiconductor Continues to Dominate in Chip Manufacturing

Taiwan Semiconductor Manufacturing Co (TSM) has solidified its position as the leading chipmaker in the world as it paid off in the third quarter of 2024. The company reported impressive growth in its global wafer foundry business, achieving a significant increase in market share, which rose to 64.9% from 62.3% in the previous quarter.

This surge in market dominance comes as demand for flagship smartphones and advanced high-performance computing (HPC) devices continues to rise, according to a TrendForce report. Taiwan Semiconductor's revenue for the third quarter reached $23.5 billion, reflecting a 39% growth compared to earlier quarters.

The chipmaker’s strong performance can be attributed to enhanced production capacity and a notable increase in wafer shipments, allowing it to outpace its competitors.

Taiwan Semiconductor credited the heightened demand in the smartphone sector and artificial intelligence technologies for its success, particularly citing the popularity of its 3nm and 5nm process technologies.

In contrast, Samsung Electronics struggled against competition from Chinese companies, with its market share dropping to 9.3%, down from 11.5% in the second quarter.

Overall, the top wafer foundry operators generated aggregate sales of $34.9 billion, marking a 9.1% sequential increase driven by the growing acceptance of the advanced 3nm technology.

China’s Semiconductor Manufacturing International Corp secured the third spot in market share with 6.0%, followed closely by United Microelectronics Corp at 5.2% and GlobalFoundries Inc at 4.8%.

Looking ahead, TrendForce forecasts robust demand for emerging technologies that could benefit the leading wafer foundry operators in the fourth quarter.

Taiwan Semiconductor and GlobalFoundries are also positioned as significant candidates for U.S. chip subsidies. Taiwan Semiconductor was awarded a $6.6 billion grant for its semiconductor facility in Phoenix, Arizona, while GlobalFoundries secured $1.5 billion for its sites in Malta, New York, and Burlington, Vermont.

Jack Huang from SinoPac Financial is optimistic about Taiwan Semiconductor's prospects, predicting a 20% business growth in 2025, which may positively influence the Taiex index on the Taiwan Stock Exchange in the first half of that year.

Investors have shown strong interest in Taiwan Semiconductor, with its stock price climbing 99% year-to-date. Exposure to this chipmaker's stock can be gained through various ETFs, including the VanEck Semiconductor ETF and Global X Emerging Markets Great Consumer ETF.

As of the latest check, TSM stock was down 0.90%, trading at $201.20.

Taiwan, Semiconductor, Chipmaker