TSMC just broke another profit record, and it still can’t make chips fast enough

You may never buy anything with “TSMC” on the box, but you almost certainly own something it made. The Taiwanese company builds the chips inside iPhones, Nvidia’s AI processors and much of the hardware that runs the internet. And business has never been better.

The numbers

TSMC’s third-quarter profit beat analyst expectations, and the company raised its forecast for the year again. High-performance computing, the category that includes AI chips, made up about 68% of revenue. Its most advanced manufacturing processes (7 nanometers and smaller) accounted for 79% of wafer revenue, and its newest 2-nanometer process is already starting to show up in the results.

The real story: there isn’t enough to go around

Even with record output, TSMC says demand is still well above what it can supply. Nvidia, Apple, AMD and Broadcom are all competing for the same limited factory space, a fight CNBC described as “fierce.” Analysts say that squeeze is giving rivals Samsung and Intel an opening, since big chip designers are now testing other factories as a backup plan.

There’s a catch for investors, too. On the same day as TSMC’s record report, chip and AI stocks sold off on worries about how the massive AI buildout is being paid for. Record profits and nervous markets in the same week tell you how big, and how uncertain, this moment is.

Why it matters to everyone else

When one company in one place builds most of the world’s advanced chips, any shortage shows up everywhere. It’s part of the reason memory and computer prices are climbing (see why your next laptop costs more), and part of why tech companies keep talking about building more chip factories in the U.S. and elsewhere.

For regular buyers, the takeaway is practical: expect new gadgets with the latest chips to stay pricey and occasionally hard to get, at least through next year.

Sources: CNBC, CNBC, DIGITIMES.