TSMC's AI Accelerator Revenue Set to Skyrocket

Doubling in 2025 After Tripling in 2024

𝙒𝙝𝙖𝙩 𝙘𝙖𝙪𝙜𝙝𝙩 𝙢𝙮 𝙖𝙩𝙩𝙚𝙣𝙩𝙞𝙤𝙣? TSMC shared an eye-catching forecast during its earnings call this week: revenue from AI accelerators is expected to double in 2025, following a tripling in 2024. The company projects AI accelerator revenue to grow at a mid-40% CAGR over the next five years.

𝙒𝙝𝙮 𝙞𝙩 𝙢𝙖𝙩𝙩𝙚𝙧𝙨? AI is a major driver of power demand from data centers, and TSMC, as the world's largest and most advanced semiconductor foundry, is at the heart of this trend. With a commanding 64% share of the global pure-play foundry market (as of Q3’24), TSMC serves industry giants like Apple, NVIDIA, AMD, and Qualcomm.

The revenue projections also highlight the scale of power demand required to support the products TSMC manufactures. For instance, NVIDIA’s flagship A100 and H100 GPUs—key to data center, AI, and high-performance computing applications—are built using TSMC's cutting-edge process nodes.

“We observed robust AI-related demand from our customers throughout 2024. Revenue from AI accelerators which we now define as AI GPU, AI ASIC, and HBM controller for AI training and inference in the data center accounted for close to mid-teens percent of our total revenue in 2024. Even after more than tripling in 2024, we forecast our revenue from AI accelerator to double in 2025 as the strong surge in AI-related demand continues … we now forecast the revenue growth from AI accelerators to approach a mid-40% CAGR for the five-year period, starting off the already higher base of 2024”

- C.C. Wei, TSMC 4Q’24 Earnings Call