Taiwan Semiconductor Manufacturing Co (TSMC), the leading producer of advanced chips crucial for artificial intelligence (AI) applications, is expected to report a 40% surge in third-quarter profits on Thursday, driven by soaring AI demand. According to an LSEG SmartEstimate, this net profit is forecasted at T$298.2 billion ($9.27 billion) for the quarter ending September 30, up from T$211 billion in the same period of 2023.

TSMC's clients, including Apple, Nvidia, AMD, Qualcomm, and MediaTek, have launched new products that heavily rely on TSMC’s advanced chip technologies. Li Fang-kuo, chairman of President Capital Management, expects the company’s earnings to exceed expectations, citing robust demand across these tech giants.

In its previous earnings call, TSMC raised its full-year revenue forecast and revised its capital expenditure plans to $30 billion to $32 billion. The company is also expanding its production capacity overseas, with $65 billion invested in building three factories in Arizona, USA, though most manufacturing remains in Taiwan.

TSMC’s stock has soared 77% this year, benefiting from the AI boom, and continues to dominate the semiconductor industry while its competitor Intel struggles to recover market share.