TSMC Becomes First Asian Company to Reach $1 Trillion Market Cap

On June 20, Taiwan Semiconductor Manufacturing Company Limited (TSMC) became the first Asian firm to surpass a market capitalization of $1 trillion. Briefly overtaking Berkshire Hathaway, TSMC became the eighth most valuable company globally.

Key Customers and Market Position

TSMC’s growth is fueled by its extensive portfolio of tech and manufacturing giants relying on its semiconductors. As the world’s largest semiconductor manufacturer, TSMC’s top clients include Apple, AMD, Intel, Nvidia, and Qualcomm. Apple is TSMC’s largest customer, with iPhone semiconductor usage accounting for about 20% of TSMC's total revenue.

Dominance in the Market

TSMC holds a dominant position in the market due to its expansive fabrication capabilities. Even global competitors like AMD, Intel, and Nvidia use TSMC for fabricating some of their chips. Additionally, TSMC has a significant presence in cryptocurrency mining, supplying semiconductors for the majority of miners, including Bitmain Antminer models. In China, 98% of Bitcoin mining rigs, made by Bitmain, use TSMC semiconductors. Samsung also uses TSMC chips in its mining operations.

Market Valuation and Competitors

After reaching the $1 trillion milestone, TSMC’s market cap has adjusted to $859.69 billion, placing it behind Berkshire Hathaway and ahead of Eli Lilly and Tesla. Nvidia, with a market capitalization of $2.9 trillion, remains the highest-valued chip maker, while Broadcom, another company that outsources fabrication to TSMC, ranks 12th with a $732.4 billion market cap.

Future Prospects

TSMC’s market position benefits from the successes of its competitors, as increased demand for products like iPhones and Nvidia’s GPUs drives the need for more semiconductors. As the artificial intelligence sector continues to grow, TSMC is well-positioned to meet the rising demand for new chips. This growth trajectory could potentially see TSMC surpass Meta (formerly Facebook) and solidify its place among the world’s most valuable companies.