Information Technology Demand for AI chips drives TSMC's profit

SDA

16.1.2025 - 08:31

Chip manufacturer TSMC can benefit from the continuing high demand for AI chips. (symbolic image)
Chip manufacturer TSMC can benefit from the continuing high demand for AI chips. (symbolic image)
Keystone

The world's most important chip manufacturer is benefiting from high demand for advanced semiconductors. However, there are also some uncertainties this year - because of Donald Trump.

Keystone-SDA

Driven by global demand for AI chips, the Taiwanese chip manufacturer TSMC has recorded a significant increase in profits. The company announced that net profit for the fourth quarter of 2024 amounted to the equivalent of 374.68 billion Taiwan dollars (around 10.4 billion Swiss francs).

This corresponds to an increase of 57% compared to the same quarter of the previous year. Observers attribute this growth to the strong demand for AI chips. TSMC is the main supplier of the US company Nvidia, the market leader in this area.

Waiting for Trump in the White House

Despite the positive development, TSMC is facing a number of challenges this year. These include uncertainties about the policies of US President-elect Donald Trump. Trump has repeatedly indicated in the past that he wants to reduce the USA's dependence on foreign manufacturers and increase chip production directly in the USA.

Most recently, the US government under Joe Biden also announced new rules that would require Nvidia to restrict the supply of its most advanced AI chips to many countries. Only close allies of the USA would then have free access.

During Trump's first term in office, TSMC announced that it would significantly expand its presence in the USA and invest in modern factories in the state of Arizona. TSMC has also begun construction of a chip factory in Dresden together with partners.

Geopolitical challenges

TSMC is the largest contract manufacturer of advanced semiconductors in the world. The Group is considered an indispensable partner for numerous Western tech companies. However, the geopolitical situation poses a challenge.

China regards democratically governed Taiwan as part of its own territory and does not rule out the possibility of annexing the island republic by force. An escalation in the conflict could have a significant impact on the global supply of semiconductors.