Updated 15 October 2026. TSMC reported third-quarter diluted EPS of NT$29.43, or US$4.60 per ADR, on Thursday 15 October, with net income up 68.7 percent year on year to NT$763.06 billion, above the LSEG SmartEstimate of NT$746.3 billion. It guided fourth-quarter revenue to US$52.3-54.3 billion, up 12-16 percent on the quarter. TSM ADRs closed at $430.00 on 14 October (Yahoo Finance, CNBC), down 3.4 percent into the print. Verdict: a clean beat with a strong guide, and every published analyst target sits above the pre-results price. Analyst range: $440 low, $538.50 median, $1,000 high.
Key facts
- Revenue: NT$1,494.24 billion, up 50.9 percent year on year and 17.6 percent on the quarter. In US dollars, US$46.72 billion, up 41.2 percent year on year, above the company’s own US$44.6-45.8 billion guidance (TSMC).
- Profit: net income NT$763.06 billion, up 68.7 percent year on year and 8.0 percent on the quarter. Diluted EPS NT$29.43, or US$4.60 per ADR unit (TSMC).
- Margins: gross 66.4 percent, inside the 65-67 percent guidance; operating 58.7 percent; net 51.1 percent (TSMC).
- Technology mix: 2-nanometer was 8 percent of wafer revenue, 3-nanometer 33 percent, 5-nanometer 28 percent and 7-nanometer 10 percent. Advanced nodes (7nm and below) made up 79 percent (TSMC).
- Q4 guidance: revenue US$52.3-54.3 billion, gross margin 65-67 percent, operating margin 56.5-58.5 percent, at an exchange rate of 31.8 NT dollars per US dollar (TSMC investor relations).
- Stock: TSM closed at $430.00 on 14 October, down $15.12, and traded near $422.55 after hours (CNBC). US trading on the results begins later on Thursday.
What the quarter showed
Revenue beat the top of TSMC’s own range by about US$0.9 billion. The company had already shown this when it released monthly sales on 8 October, including September revenue of NT$511.9 billion (see our September sales report). The new information on Thursday was profit and margins.
Both came in strong. Net income of NT$763.06 billion was about 2 percent above the NT$746.3 billion LSEG SmartEstimate drawn from 16 analysts. Gross margin of 66.4 percent landed in the upper half of the 65-67 percent range despite the ramp of the 2-nanometer node, which reached 8 percent of wafer revenue in its early quarters. New nodes usually dilute margins while yields mature. That concern was one reason TSM fell 3.45 percent on Wednesday, according to TradingKey.
Net income grew more slowly than revenue on the quarter, 8.0 percent against 17.6 percent. The net margin of 51.1 percent compares with the roughly 50 percent that TIKR’s preview had expected, so the slippage was smaller than feared.
The Q4 guide
The US$52.3-54.3 billion range implies 12-16 percent growth on the third quarter’s US$46.72 billion, with gross margin held at 65-67 percent. For a company of TSMC’s size, double-digit sequential growth in the fourth quarter points to sustained demand for AI accelerators. TokenPost reported that TSMC raised its 2026 revenue growth outlook to about 44 percent in US dollars, from slightly above 40 percent, and kept capital spending at US$60-64 billion.
The read-through runs across the AI chip supply chain. Nvidia, AMD and Broadcom design chips that TSMC builds, and memory makers such as Micron supply the high-bandwidth memory packaged with them. Our Micron analysis covers the memory side.
TSM stock: 12-month analyst targets
| Target | TSM | What it assumes | Anchor |
|---|---|---|---|
| Low | $440 | Growth slows in 2027 as AI capex digests, and 2nm and overseas fabs weigh on margins. | Lowest of 21 analyst targets (S&P Global via StockAnalysis), about 2 percent above the $430 close. |
| Mid | $538.50 | Revenue growth in line with the raised outlook and margins held in the mid-60s. | Median target (StockAnalysis); the average is $578.22. Stifel $515, Bernstein $554. |
| High | $1,000 | AI demand keeps outrunning capacity into 2027 and 2028, with pricing power on 2nm and advanced packaging. | Highest target (StockAnalysis). Among recent notes: Bank of America $620, Barclays $665. |
All three targets sit above the $430 close, so even the low end implies upside. The targets were set before Thursday’s results and can change after them. The main downside risks are a fall in AI spending, margin pressure from new nodes and overseas fabs, and US-China trade measures.
For the longer-term bull and bear framework, see our TSM stock bull and bear analysis.
What to watch
- US trading today: whether TSM recovers the $445.12 close of 13 October, and how Nvidia, AMD, Broadcom and Micron react.
- Call commentary: management’s view on 2027 demand, CoWoS packaging capacity and 2nm pricing.
- Analyst revisions: target changes over the next few days.
- November: TSMC’s October monthly revenue, the first check on the Q4 guide.
Quick take: TSMC beat on profit, held gross margin at 66.4 percent while ramping 2nm, and guided Q4 revenue up 12-16 percent to US$52.3-54.3 billion. The ADR fell 3.4 percent to $430 into the print on margin worries that the numbers did not confirm. Every one of 21 published analyst targets, from $440 to $1,000, sits above that close. The near-term risk is not the quarter but whether AI spending holds into 2027.
FAQ
What did TSMC earn in Q3 2026?
TSMC reported net income of NT$763.06 billion and diluted EPS of NT$29.43, or US$4.60 per ADR unit, for the quarter ended 30 September 2026. Net income rose 68.7 percent year on year.
Did TSMC beat expectations?
Yes. Net income came in above the LSEG SmartEstimate of NT$746.3 billion from 16 analysts, and US dollar revenue of US$46.72 billion beat the company’s own US$44.6-45.8 billion guidance.
What is TSMC’s Q4 2026 guidance?
Revenue of US$52.3-54.3 billion, gross margin of 65-67 percent and operating margin of 56.5-58.5 percent, based on an exchange rate of 31.8 NT dollars per US dollar.
What is the TSM stock price?
TSM ADRs closed at $430.00 on 14 October 2026, down 3.4 percent, and traded near $422.55 after hours, according to CNBC. US trading on the results begins later on 15 October.
What is the analyst price target for TSM?
21 analysts tracked by S&P Global have targets from $440 to $1,000, with a median of $538.50 and an average of $578.22 (StockAnalysis). The consensus rating is Strong Buy.
How much of TSMC’s revenue comes from 2nm and 3nm chips?
In Q3 2026, 2-nanometer accounted for 8 percent of wafer revenue and 3-nanometer for 33 percent. Nodes of 7nm and below made up 79 percent.
Sources: TSMC third-quarter 2026 earnings release and investor relations guidance table (15 October 2026); LSEG SmartEstimate (net profit consensus); Yahoo Finance and CNBC (TSM close and after-hours price, 14 October); TradingKey (14 October move); TIKR (earnings preview); TokenPost (2026 growth outlook and capex, 15 October); StockAnalysis / S&P Global (analyst targets and recent rating actions).
This article is for information only and is not investment advice. Share prices move continuously and the figures above were accurate at the time of writing. Nothing here is a recommendation to buy or sell any security. Do your own research and consider your own circumstances before investing.
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