As the world’s largest semiconductor foundry, the TSMC provides a great position to benefit from the growth of the AI chips.
PG distribution in areas such as the internet of things and the automotive industry should also help.
The TSMC evaluation makes the shares attractive at the moment, taking into account its healthy growth potential.
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Technology Nasdaq Composite Arrow over the latter S&P 500 The leap of the arrow is 240%. The disrupted nature of technology companies is the main reason why Nasdaq has provided a higher return. Innovation in this sector, technology companies can increase at faster prices. New products, services and functions can be a quick reception for customers, organizations and governments, which increases the growth of technology stocks and income.
Production of Taiwan semiconductors(NYSE: TSM)Popularly known as the TSMC, enables innovation and disorders using advanced chips. Not surprisingly, TSMC Stock has created an extraordinary 12.5x over the last decade, which is significantly outperforming the Nasdaq Composite Index leap.
Let’s look at the reasons why it has real potential over the next 10 years to outdo the nasdaq composite.
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TSMC is the world’s largest semiconductor foundry. According to the Counterpoint Research, it controlled 35% of the total Foundry 2.0 market in the first 2025. In the quarter, increasing its share by almost six percentage points since the year AGO period.
The Foundry 1.0 market is characterized by Pure Chip Manufacturing, and Foundry 2.0 includes additional services such as improved packaging, assembly and testing and photomassas. The TSMC, previously producer of pure game chips, expands its experience to offer Foundry 2.0 solutions to its customer base.
This explains why the company continues to occupy a larger share of this market. TSMC founded a huge advantage over its competitors in the Foundry 2.0 space and second place took second place Intel Controling a little more than 6% of this market in the first quarter. Another thing worth noting is that the Foundry 2.0 market increased by 13% of revenue a year in 2025. In the quarter up to $ 72 billion, which is driven by the growth of artificial intelligence (AI) and high -performance calculation chips.
TSMC advanced chip production processes are used by several Fabless chips designers such as AMDIs it NvidiaIs it BroadcomIs it SonyIs it An appleIs it Qualcommand others who do not have their own production equipment. These companies have tapped the TSMC 3NM (nanometer) and the 5nm process nodes to make AI chips that fall into several programs, from data centers to consumer electronics devices to vehicles.
Specifically, 60% of the TSMC’s revenue consisted of a segment of the previous quarter high -performance (HPC) segment, while smartphones accounted for 27%. The Internet of Things (IOT) and the car segment is currently not moving needles for the company. However, it is expected that all of these final markets will be monitored by healthy growth over the next decade, creating the path to secular growth TSMC.
E.g. According to one calculation, it is expected that by 2030 The cost of the AI -oriented data center will increase by almost 4x, which should allow TSMC to sell more advanced chips.
Meanwhile, admission in other areas, such as the robotics and the automotive industry, can create more profitable TSMC growth opportunities. In general, the AI chip market hopes that the annual growth rate will be almost 35% to 2035. The TSMC’s solid foundry market part gives it a strong position to maximize this huge growth.
TSMC growth has risen spectacularly over the last couple of years due to AI boom.
Ycharts data.
This year, the company expects 30% of the revenue. In the future, it can also maintain such an impressive level of growth, as he focuses on further improvement of its production processes, which should provide the opportunity to maintain its healthy lead in this market. For example, TSMC is already building 2NM and A16 (1.6 Nm) chips.
These new processes are expected to ensure a significant increase in performance and efficiency compared to the current 3nm chip node. The 2NM process is expected to increase from 10% to 15% while lowering energy consumption by 20% to 30%. The A16 process is expected to repeat such an increase compared to the 2nm process.
Improved productivity of new TSMC chips should be useful when it comes to performing AI workloads in the cloud and edge devices such as smartphones and personal computers. Thus, TSMC seems to keep its example in the foundry market in the future. It is currently not transferred to 25 times income, as its healthy financial results can help this AI campaign over the next 10 years bypassing Nasdaq Composite profits.
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Chauhan has no position in any of the said shares. The Motley Fool has positions and recommends advanced Micro devices, Apple, Intel, Nvidia, Qualcomm and Taiwan’s semiconductor production. The Motley Fool recommends Broadcom and recommends the following options: short 2025. August 24 USD calls Intel. The Motley fool has a disclosure policy.
Forecast: This artificial intelligence (s) stock will outperform Nasdaq over the next decade
