Eugene Castillo
Taiwan Semiconductor Manufacturing Company (NYSE:TSM), the world's largest contract chipmaker and the manufacturer behind most of the advanced processors powering AI data centers, reports second quarter 2026 results on July 16. Ahead of that date, TSM expected earnings have climbed as analysts bet the AI buildout still has legs, and shares now trade at 436.96 dollars, up 0.55% on the day.
- Price: 436.96 dollars, up 0.55% for the session
- 52 week range: 365.11 to 479.00 dollars
- Market cap: 2.27 trillion dollars
- Dividend yield: 1.02%
- RSI: 50.62, a neutral reading
| Price | 436.96 USD |
|---|---|
| Day change | +2.41 (+0.55%) |
| 52-week range | 365.11 – 479.0 |
| Market cap | $2.27T |
| Dividend yield | 1.02% |
| RSI (14) | 50.62 |
| Volume | 11,455,545 |
The stock jumped nearly 40% during the April through June stretch, riding continued buildout of advanced packaging capacity, progress toward high volume 2 nanometer production, and steady orders from hyperscale cloud companies buying up AI chips. That rally is part of why expectations are running hot into this print. TSMC has beaten earnings estimates in each of the past four quarters, with an average surprise of 8.34%.
What Analysts See for TSM Expected Earnings
The consensus estimate for second quarter earnings per share has risen 4.4% over the past three months to 3.77 dollars, which would mark a 52.6% jump from a year earlier. Revenue estimates sit near 39.8 billion dollars, implying growth of about 32.2% year over year. Management's own guidance, issued alongside first quarter results, called for revenue of 39 to 40.2 billion dollars, roughly 10% sequential growth at the midpoint, with gross margin expected between 65.5% and 67.5%. That margin range reflects high fab utilization and cost discipline, tempered somewhat by the expense of ramping new overseas plants.
Executives have described AI chip demand as extremely robust, pointing to the shift from generative AI toward agentic AI as a force pushing computing needs even higher across data centers. TSMC also lifted its 2026 capital spending outlook to the top of its 52 to 56 billion dollar range and reaffirmed that full year revenue should grow more than 30% in dollar terms. The company has said demand for its most advanced manufacturing nodes remains supply constrained, which is why it keeps adding N3 capacity in Taiwan, Arizona, and Japan, while its N2 ramp is progressing well enough that management now views it as another long term growth driver.
Valuation, Momentum and Yield at TSMC
With shares near the upper half of their 52 week range of 365.11 to 479.00 dollars, TSM isn't cheap by traditional yardsticks, and the 1.02% dividend yield won't be the draw for anyone buying this stock. Investors are paying for growth and market position, not income. The RSI of 50.62 sits right in neutral territory, neither overbought nor oversold, suggesting the stock has cooled off from its second quarter surge without breaking down.
The bull case rests on TSMC's near monopoly on the most advanced chip manufacturing that companies like Nvidia and Apple depend on, plus a capital spending plan that signals management expects AI demand to keep growing for years. A positive earnings ESP of 0.11%, paired with a Zacks Rank of 2 (Buy), points to conditions that have historically favored companies beating estimates.
The bear case centers on execution risk tied to that same capital spending: overseas fabs in Arizona and Japan cost more to run than Taiwan facilities, and any slowdown in hyperscaler AI budgets, or a flare up in trade tensions given TSMC's exposure to global geopolitics, could dent the growth story that's currently priced into shares near the top of their range.
Where TSMC Stands Against Intel and Broadcom
Intel, which carries a Zacks Rank of 1 (Strong Buy), is expected to show progress in its foundry turnaround when it reports, helped by its 18A process and expanding packaging work, though heavy investment continues to squeeze near term profits. Broadcom, ranked 2 (Buy) by Zacks, should benefit from continued hyperscaler spending on custom AI accelerators and networking gear when it reports third quarter fiscal 2026 results. Both companies operate in adjacent corners of the same AI infrastructure buildout that's lifting TSMC.
What This Earnings Print Will Reveal About AI Demand
The July 16 report will offer one of the clearest reads yet on whether AI infrastructure spending is holding up at the pace hyperscalers have promised. TSMC's guidance, its raised capital budget, and a market cap of 2.27 trillion dollars all reflect a bet that demand keeps climbing. Whether the company's actual results match the optimism baked into estimates will matter for the whole chip sector, not just TSM shareholders.
Frequently Asked Questions
Is TSM profitable?
Yes. TSMC has posted consistent profitability and has beaten earnings estimates in each of the last four quarters, with second quarter 2026 EPS expected to rise 52.6% year over year to 3.77 dollars.
Is TSM expected to beat earnings?
Conditions look favorable: the company has a positive earnings ESP of 0.11% and a Zacks Rank of 2 (Buy), a combination that has historically pointed toward earnings beats, though the actual result won't be known until the July 16 report.
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