TSMC: Revenue Growth Will Continue to Outpace Capital Expenditure Growth in Coming Years
TSMC raised its 2026 capital expenditure to $56 billion due to strong AI demand. CFO Wendell Huang expects revenue growth to outpace CapEx growth in the coming years, while maintaining a long-term gross margin target of over 56%.
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- 📰 Published: April 16, 2026 at 17:49
- 🔍 Collected: April 16, 2026 at 18:02 (12 min after Published)
- 🤖 AI Analyzed: April 19, 2026 at 02:49 (56h 47m after Collected)
(Central News Agency, reporter Chung Jung-feng, Taipei, 16th) TSMC held its online earnings call this afternoon. TSMC Chief Financial Officer Wendell Huang pointed out that this year's capital expenditure has been revised upward to approach $56 billion, which will account for nearly half of the cumulative capital expenditures over the past three years. He noted that TSMC's revenue growth in the coming years will continue to outpace its capital expenditure growth.
During its Q1 earnings call today, TSMC stated that in response to robust demand in applications such as 5G, Artificial Intelligence (AI), and High-Performance Computing (HPC), the company continues to invest. The projected capital expenditure for this year has been raised to the upper end of the previously estimated range of $52 billion to $56 billion.
Huang pointed out that over the past three years, TSMC's capital expenditures totaled $101 billion. This year alone approaches half of the total from the past three years, indicating TSMC's deep confidence in the development and demand of the AI industry. It is expected that the scale of TSMC's capital expenditures over the next three years will be significantly higher than in the past three years.
When asked by foreign institutional investors whether the growth rates of future revenue and capital expenditures would synchronize, Huang said that over the past three years, TSMC's revenue growth trajectory surpassed its capital expenditure growth. If operations remain steady, TSMC's revenue growth trajectory in the coming years will continue to outpace its capital expenditure growth.
Huang reiterated that in the long term, TSMC's gross margin can exceed 56%, and relevant targets are steadily progressing.
He noted that TSMC's 2-nanometer (2nm) process will enter the initial mass production phase in the second half of this year, which will begin to dilute the gross margin. It is expected that the full-year gross margin this year will be diluted by about 2% to 3%.
Additionally, as TSMC continues to expand its overseas production footprint, Huang expects that as overseas wafer fabs successively begin mass production over the next few years, the initial dilutive effect on TSMC's gross margin will be about 2% to 3%, expanding to 3% to 4% in the later stages.
Observing the recent impact of tensions in the Middle East, Huang pointed out that the prices of certain chemicals and gases may rise, and current assessments indicate that profitability might be slightly affected. However, it is still too early to judge the exact extent of the impact, and external exchange rate fluctuations must also be continuously monitored.
During its Q1 earnings call today, TSMC stated that in response to robust demand in applications such as 5G, Artificial Intelligence (AI), and High-Performance Computing (HPC), the company continues to invest. The projected capital expenditure for this year has been raised to the upper end of the previously estimated range of $52 billion to $56 billion.
Huang pointed out that over the past three years, TSMC's capital expenditures totaled $101 billion. This year alone approaches half of the total from the past three years, indicating TSMC's deep confidence in the development and demand of the AI industry. It is expected that the scale of TSMC's capital expenditures over the next three years will be significantly higher than in the past three years.
When asked by foreign institutional investors whether the growth rates of future revenue and capital expenditures would synchronize, Huang said that over the past three years, TSMC's revenue growth trajectory surpassed its capital expenditure growth. If operations remain steady, TSMC's revenue growth trajectory in the coming years will continue to outpace its capital expenditure growth.
Huang reiterated that in the long term, TSMC's gross margin can exceed 56%, and relevant targets are steadily progressing.
He noted that TSMC's 2-nanometer (2nm) process will enter the initial mass production phase in the second half of this year, which will begin to dilute the gross margin. It is expected that the full-year gross margin this year will be diluted by about 2% to 3%.
Additionally, as TSMC continues to expand its overseas production footprint, Huang expects that as overseas wafer fabs successively begin mass production over the next few years, the initial dilutive effect on TSMC's gross margin will be about 2% to 3%, expanding to 3% to 4% in the later stages.
Observing the recent impact of tensions in the Middle East, Huang pointed out that the prices of certain chemicals and gases may rise, and current assessments indicate that profitability might be slightly affected. However, it is still too early to judge the exact extent of the impact, and external exchange rate fluctuations must also be continuously monitored.