TSMC: The Market Is Punishing The Wrong AI Stock

Taiwan Semiconductor Manufacturing Company delivered a standout Q2 with $40.2B in revenue, a 67.7% gross margin, and robust Q3 guidance. TSM's capital expenditure guidance increased to $60–$64B for 2026, reflecting strong customer demand rather than speculative capacity expansion. Margins remain exceptional despite capex intensity, with Q3 guidance for 65–67% gross margin and 56–58% operating margin. I rate TSM a 'Buy' as the recent sell-off reflects sector positioning, not deteriorating fundamentals; TSM remains a premier AI infrastructure play.

Taiwan Semiconductor Manufacturing Company ( TSM ) just finished the sort of quarter most AI-linked companies would like to report. Revenue came in at $40.2 billion, at the top end of the company’s previous guidance range. Gross margin was 67.7%, operating margin was This article was written by Sharon McArd 826 Followers Follow I’m a retail investor based in Sydney with three years of experience focusing on achieving financial independence through strategic investments in AI-driven companies. Although I don’t come from a traditional finance background, I’ve developed a strong passion for understanding how artificial intelligence is transforming the global economy. Over the past few years, I’ve become increasingly fascinated by the possibilities of AI—how it’s reshaping industries, driving innovation, and creating new investment frontiers. My portfolio is primarily centered around leading AI-related companies such as NVIDIA and others at the forefront of this technological revolution. I believe we’re only in the early stages of AI’s impact, and the coming decade will present remarkable opportunities for both retail and institutional investors. My goal is to continue learning, sharing insights, and building long-term wealth by investing in the technologies shaping our future.