TSMC Shares Rebound as Expansion Concerns Are Dismissed

TSMC US8740391003

Recent market jitters surrounding Taiwan Semiconductor Manufacturing Company's (TSMC) international expansion plans have been decisively quelled by company officials, leading to a stabilization in its share price. Investors appear to have interpreted the previous week's pullback as a buying opportunity, reinforcing confidence in the chipmaker's strategic direction.

Concurrent with the operational reassurances, data from the Taiwanese exchange reveals a significant surge in shareholder confidence at the grassroots level. The number of TSMC shareholders has reached an eight-month high of 1.88 million.

Market observers interpret this trend as clear evidence that retail investors aggressively purchased shares during last week's decline. This bullish sentiment is fundamentally supported by TSMC's commanding position in supplying the artificial intelligence sector. The high utilization rates of its advanced 3nm and 4nm manufacturing processes, driven by key clients like Nvidia and Apple, continue to justify a premium market valuation. The stock is currently trading at 249.00 euros, reflecting a year-to-date gain of 26.65 percent.

Japan Construction Proceeding on Schedule

The source of the recent uncertainty was speculation that construction of the second fabrication plant ("Fab 2") by its Japanese subsidiary, JASM, might be facing delays. However, JASM President Yuichi Hotta has now officially confirmed that the project in Kumamoto, Japan, is progressing exactly according to plan.

This clarification was crucial for market participants, dispelling concerns about the stability of TSMC's supply chain diversification outside Taiwan. Investors view the smooth progress in Japan, especially when contrasted with the more politically and operationally complex expansion in the United States, as proof of the contract manufacturer's effective diversification strategy.

Upcoming Earnings Report in Focus

Investor attention is now shifting toward January 14, 2026, the date TSMC has scheduled for the release of its upcoming quarterly results. Analysts will be scrutinizing the guidance for the first quarter of 2026 with particular care. Their focus will be on assessing whether sustained demand from AI-related clients can offset any seasonal softness in the traditional consumer electronics segment. Market experts currently see further upside potential, citing an average price target of approximately 355 US dollars.