TSMC's AI growth story will need need to 'prove its returns' in 2028-2029: Analyst - CNBC

According to CNBC, analysts hold a cautiously optimistic view of TSMC's growth in the artificial intelligence sector. While TSMC dominates AI chip manufacturing, analysts note that its AI business sto... Read original →

TSMC’s dominance in AI chip fabrication is entering a critical validation phase. While its advanced 3nm and sub-3nm processes underpin the production of high-performance AI server chips for companies like NVIDIA, analysts stress that the company must demonstrate sustainable profitability by 2028–2029. The surge in global AI computing demand is accelerating the semiconductor industry’s move toward higher integration levels, with EUV lithography playing a central role in maintaining TSMC’s competitive edge. However, geopolitical tensions, supply chain fragility, and regulatory uncertainties in Taiwan, China, are increasing operational risks and compliance costs. Competitors such as Intel, AMD, and Infineon are ramping up their own advanced process capabilities, aiming to capture market share. If TSMC fails to align capacity expansion with technological innovation, its long-term market leadership may be at risk. Over the next 12–24 months, shifts in customer demand, capital expenditure returns, and production capacity utilization will be key indicators of industry dynamics.