Taiwan Semiconductor (TSM) Stock: Jumps 83% in a Year — Bernstein Thinks There’s More to Come

TLDR

• Bernstein raised TSMC’s target price from NT$1,800 to NT$2,200
• AI revenue projected to exceed 20% of total revenue by 2026, up from 18% in 2025
• TSMC approved $44.96 billion in capital expenditure to expand AI chip production
• February revenue hit NT$317.6 billion — up 22.2% year-over-year
• Combined January–February revenue grew ~30% versus the same period last year

TSMC’s board approved nearly $45 billion in capital expenditure as Bernstein lifted its price target and AI revenue projections point firmly upward.

Taiwan Semiconductor Manufacturing Company Limited, TSM

TSMC reported February revenue of NT$317.6 billion, a 22.2% year-over-year jump. That figure dipped about 21% from January, but that’s a normal seasonal pattern — nothing to read into.

Zoom out and the picture looks even stronger. Combined revenue for the first two months of 2026 climbed roughly 30% compared to the same period in 2025. The engine behind that growth? High-performance computing and AI demand from the likes of Apple, Nvidia, and AMD.

Bernstein analysts say AI-related revenue will top 20% of TSMC’s total income by 2026. That’s up from an estimated 18% in 2025. It’s not just logic chips driving that number either.

TSMC has started generating AI revenue through High Bandwidth Memory (HBM) base dies — the layer used at the bottom of HBM stacks. That’s a relatively new contribution, and it’s adding another lane to the AI revenue highway.

Bernstein Raises Price Target

On the back of these projections, Bernstein bumped TSMC’s target price from NT$1,800 to NT$2,200. Analysts pointed to AI momentum and stable non-AI demand as the two pillars supporting that upgrade.

Non-AI demand isn’t going anywhere either. High-end smartphones continue to underpin that side of the business. Bernstein also noted that if any non-AI clients free up capacity, AI customers — who are currently facing shortages — are positioned to absorb it quickly.

That supply-demand dynamic gives TSMC a useful buffer. Even a slowdown in one segment gets mopped up by the other.

$45 Billion Capital Spend

TSMC’s board greenlit $44.96 billion in new capital expenditure. The money is earmarked for advanced manufacturing, packaging improvements, specialty technologies, and new fabrication plant construction.

That’s not a defensive move — it’s a direct response to sustained client demand. TSMC is building capacity now so it can deliver later.

For shareholders, there’s a more immediate reward on the table. The company declared a Q4 2025 cash dividend of $0.9503 per ADS, payable July 9, 2026, to holders of record as of June 11, 2026.

TSM stock has climbed more than 83% over the past twelve months, closing last Friday at €295.50.

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