Taiwan Semiconductor Manufacturing NYSE:TSM fell about 4% early Thursday after reporting second-quarter results that exceeded Wall Street expectations and issuing a stronger-than-expected third-quarter outlook.
Taiwan Semiconductor projected third-quarter revenue of $44.6 billion to $45.8 billion, with a midpoint of $45.2 billion, above analysts' expectations. The company said continued demand for its advanced 2-nanometer chip technology is expected to support growth during the quarter.
Taiwan Semiconductor is also reportedly preparing a major expansion of its U.S. manufacturing operations. The plan could increase the company's U.S. investment by $100 billion, bringing the total to $265 billion, according to published reports.
The proposed expansion would add four fabrication plants, raising Taiwan Semiconductor's U.S. manufacturing network to 10 fabs and two advanced packaging facilities.
The investment underscores the company's effort to increase production capacity outside Taiwan as demand for advanced semiconductors continues to grow.
Despite the upbeat earnings report and outlook, Taiwan Semiconductor shares declined as investors weighed valuation and broader market sentiment surrounding semiconductor stocks.