From Seekingalpha · Bears of Wall Street · · 30s
TSMC: Cracks in Tech Leadership
TSMC's record earnings mask growing risks to long-term profits.
In brief
TSMC's record earnings mask growing risks to long-term profits. TSMC's aggressive 2026 CapEx cycle threatens profitability despite record earnings. Originally reported by Seekingalpha.
TSMC earnings
TSMC posted record earnings but I reiterate a SELL rating due to emerging risks.
“TSMC maintains global technological leadership and posted record earnings”
2026 CapEx cycle
TSM plans $60-$64 billion in CapEx for 2026 with further increases expected.
“TSM's aggressive CapEx cycle, with $60-$64 billion planned for 2026”
Profitability risks
Costly technology transitions and international expansion pressure gross margins.
“Gross margins are pressured by costly technology transitions (N2, N3) and international expansion”
The key point
TSMC's aggressive 2026 CapEx cycle threatens profitability despite record earnings.
