TSMC Lifts 2026 Growth to 44% and Brokers Push 2028 Capex to $105 Billion on 2nm Ramp
TSMC's third-quarter net profit rose 68.7% to a record NT$763bn with 2nm at 8% of wafer revenue, and brokerages responded by lifting capex forecasts to as much as $105bn for 2028 while raising ASP and CoWoS capacity assumptions.
TSMC reported third-quarter consolidated revenue of NT$1,494.24bn, net income of NT$763.06bn and diluted EPS of NT$29.43, equal to US$4.60 per ADR unit. Revenue rose 50.9% year on year and 17.6% sequentially, with net income and EPS both up 68.7%, extending the earnings growth streak to a sixth consecutive quarter. In US dollars revenue was $46.72bn, up 41.2% year on year. Gross margin was 66.4%, operating margin 58.7% and net margin 51.1%. The 2nm ramp is accelerating, with its share of wafer revenue rising to 8% from 3% in the second quarter; 3nm accounted for 33%, 5nm for 28% and 7nm for 10%, putting advanced nodes at 79% of wafer revenue.
The spending signal mattered more than the print. TSMC kept 2026 capex guidance at $60-64bn but flagged plans to accelerate 2nm and add four 3nm fabs, and acknowledged that tool inflation is real. UBS now models roughly 45% year-on-year growth to $90bn in 2027 and $105bn in 2028. Morgan Stanley cited supplier checks pointing to EUV tool bookings doubling in 2027 and rising another 25-30% in 2028, and lifted its estimates to $83bn and $92bn. Goldman Sachs and BofA Securities both see 2027 spending at about $85bn.
Margins are the pressure point. Fourth-quarter gross margin guidance of 65-67% implies little upside from the third quarter's 66.4% as the 2nm ramp and overseas fabs dilute profitability. Citi, UBS and Goldman Sachs all model 66.6% for 2026, rising to 66.7-68.9% in 2027 and 67.1-68.9% in 2028. Pricing is expected to carry the load: Daiwa forecasts the blended eight-inch-equivalent ASP rising from $3,513 in 2026 to $4,034 in 2027 and $4,231 in 2028, while UBS is more aggressive at $3,691, $4,417 and $5,177.
Advanced packaging is the other leg. Goldman Sachs projects CoWoS capacity of 1.275m wafers in 2026, about 106,000 a month, rising 114% to 2.73m in 2027 and a further 27% to 3.48m in 2028, nearly 290,000 a month. Aletheia expects cutting-edge wafer revenue to double between 2026 and 2028 with advanced packaging revenue quadrupling over the same period, even as Intel's EMIB becomes a more credible alternative. Management raised its 2026 revenue growth outlook to 44% and guided to another record quarter, with foreign brokers broadly modelling 10-15% sequential fourth-quarter revenue growth.