TSMC, the undisputed global leader in contract semiconductor manufacturing, has announced impressive operating results for May 2025. The company significantly exceeded Wall Street expectations and sent a positive signal to the market.
According to the official report, TSMC’s revenue reached $10.7 billion in May. This result represents an impressive 39.6% increase compared to May 2024. However, compared to the powerful April 2025, which recorded annual growth of 48%, May revenue decreased by 8.3%, reflecting the expected seasonality and cyclical demand.
The main reason for optimism is significantly exceeding analysts’ consensus forecasts. Market expectations before the release were noticeably more modest. Despite the monthly decline, the strong May figure indicates that the fundamental demand for advanced chip manufacturing technologies offered by TSMC remains exceptionally stable. The market immediately reacted positively: the S&P 500 index strengthened in response to the news from TSMC, underscoring its role as a key barometer of the health of the technology sector and the entire global economy.
A comparison of the two months within the quarter does show a slight slowdown in annual growth (from 48% in April to 39.6% in May). However, it’s important to note that this is not a sign of weakness but normalization after an exceptionally high baseline and movement within the company’s forecasts.
TSMC’s management had previously forecast revenue growth for the second quarter of 2025 at about 39% year-on-year. The May result aligns perfectly with this trajectory. For 2025, the company maintains its 24-26% revenue growth forecast.
The exponentially growing demand for high-performance semiconductors for artificial intelligence systems continues to be the main engine of growth. The most powerful GPUs and specialized accelerators necessary for the training and operation of AI models are produced mainly on advanced TSMC GPUs (5 nm, 4 nm, 3 nm, and the latest 2 nm). This demand continues to significantly surpass supply, allowing TSMC to maintain high capacity utilization and premium prices.
TSMC’s success cannot be viewed in isolation from its largest customers. Last month, Nvidia, a company whose flagship GPUs for AI are one of the main products manufactured at TSMC factories, delivered an encouraging quarterly report.
Nvidia’s management has confidently stated its ability to maintain high revenue growth rates, despite the ongoing difficulties associated with US export restrictions on China. However, the Chinese market remains critically important for Nvidia, although its revenue share has decreased to about 12%. New US sanctions imposed at the end of 2024 have further tightened the rules for supplying advanced AI chips to China.
In response, Nvidia is actively developing and offering Chinese customers special versions of its Blackwell-based accelerators (for example, GB200) featuring compliant GDDR7 memory, to maintain its presence in this strategic market. It is important to note that since the first sanctions in 2022, Nvidia’s share of the Chinese high-performance AI chip market has dropped from a staggering 95% to about 50%, opening up opportunities for local players such as Huawei. Nevertheless, Nvidia’s confident tone indirectly confirms the resilience of demand and TSMC’s ability to adapt production to meet specific customer requirements despite regulatory constraints.
TSMC’s May report is a powerful signal of the strength of the semiconductor giant and the sector as a whole. Exceeding expectations with 39.6% annual growth, even considering the expected monthly decline, demonstrates that the “AI engine” continues to operate at full capacity.
The demand for advanced chip manufacturing technologies remains unfulfilled, and TSMC is the dominant player. Confident forecasts and actions of key customers, such as Nvidia, despite geopolitical difficulties, reinforce the positive outlook. Although the growth rate has slowed slightly compared to the peak in April, the company is confidently moving toward meeting its quarterly and annual goals. For global markets, TSMC’s strong results are an essential indicator of the sustainability of the technology sector and the prospects for further growth.
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