Taiwan Semiconductor Manufacturing Company (TSMC) reported a 54% year-on-year increase in net profit for the third quarter, reaching NT$325.3 billion ($10.06 billion), surpassing analysts' expectations of approximately NT$300 billion. Earnings per share stood at NT$12.54 ($1.94 per ADR unit). Revenue rose 36% to NT$759.7 billion ($23.5 billion), driven by strong demand for AI semiconductors and smartphones, particularly for its industry-leading 3nm and 5nm technologies, which accounted for 20% and 32% of revenue respectively. Wafer shipments increased by 15% year-on-year to 3.338 million units. Major clients such as Apple and Nvidia contributed to the surge in sales. Gross margin improved to 57.8%, exceeding the company's guidance and the market estimate of 54.8%, and the operating margin rose to 47.5%. TSMC raised its fourth-quarter revenue forecast to between $26.1 billion and $26.9 billion, higher than market expectations of $24.94 billion, and provided a gross margin guidance of 57-59%. The company also increased its full-year revenue growth outlook to close to 30% in US dollar terms and adjusted its capital expenditure for 2024 to slightly above $30 billion. TSMC's CEO stated that the AI demand is 'real' and that 'almost every AI innovator is working with TSMC', noting that one key customer described current demand as 'insane'.