TSMC lifts 2030 global chip market forecast to $1.5 trillion on AI demand
The foundry giant reports $35.90 billion in Q1 2026 revenue, up 35.1 per cent year-on-year, while projecting AI and high-performance computing will command 55 per cent of the semiconductor market by decade’s end.
Taiwan Semiconductor Manufacturing Company (TSMC) has revised its forecast for the global semiconductor market by 2030 upwards to $1.5 trillion, a significant increase from its previous estimate of $1 trillion. The company attributed the revised outlook to robust demand for high-performance computing and artificial intelligence, which it projects will account for 55 per cent of the total market share. Smartphones and automotive sectors are expected to hold 20 per cent and 10 per cent of the market respectively.
The chipmaker reported first-quarter 2026 revenue of $35.90 billion, representing a 35.1 per cent year-on-year increase. This performance was driven by an 11-fold surge in AI accelerator wafer demand between 2022 and 2026. High-performance computing remained the primary growth catalyst, now accounting for 61 per cent of total revenue, while advanced nodes including 3nm, 5nm, and 7nm comprised 74 per cent of total wafer revenue.
TSMC also raised its full-year 2026 revenue guidance to above 30 per cent growth in US dollar terms. To support this expansion, the company increased its 2026 capital expenditure budget to the high end of the $52 billion to $56 billion range. Management expects second-quarter 2026 revenue to climb sequentially to between $39.0 billion and $40.2 billion.
Technological projections indicate a 70 per cent compound annual growth rate from 2026 to 2028 for advanced 2-nanometer and next-generation A16 chip capacity. Additionally, CoWoS advanced packaging capacity is forecast to grow at an 80 per cent compound annual growth rate between 2022 and 2027. The company plans nine phases of wafer fabs and advanced packaging facilities in 2026 to meet this demand.
Regional expansion continues with the first Arizona fab now operational and a second slated for tool move-in in 2026. The second Japan fab has been upgraded to 3-nm nodes, and construction on an automotive-focused German facility remains on schedule. TSMC holds a cash reserve of $106 billion, providing liquidity for its capital-intensive cycle.
Analyst consensus for TSMC stock stands at "Strong Buy," with a mean price target of $444.38. This rating is based on 14 "Strong Buy" and 2 "Moderate Buy" designations from 18 analysts. The stock has delivered a 37.46 per cent gain year-to-date and an 114.48 per cent return over the past twelve months.
