Stocks across the chipmaking supply chain got a boost Thursday. A blowout investment forecast from Taiwan Semiconductor Manufacturing lifted the sector.

Taiwan Semiconductor, or TSMC, said its capital expenditure forecast for this year will be in the range of $52 billion to $56 billion, well ahead of market expectations and its $40.9 billion capex for 2025.

That might be just the start. TSMC executives told analysts on an earnings call that the company’s capex has amounted to $101 billion in the past three years but it expects the amount to be “significantly higher” in the next three years.

“So, 2026-2027 for the short term, we are looking to improve our productivity. 2028-2029…we start to increase our Capex significantly, and it will continue this way if the AI demand megatrend [continues] as we expected,” TSMC Chief Executive C.C. Wei said.

That’s great news for companies that sell machinery and other tools for chip manufacturing. American depositary receipts of Dutch semiconductor-manufacturing equipment company ASML Holding were up 5.4%. Its overall market valuation surpassed $500 billion.

U.S. companies Applied Materials and Lam Research rose 5.7% and 4.2%, respectively.

KLA Corp. was up 7.7%, reaching a market value above $200 billion for the first time, according to Dow Jones Market Data. It was the top-performing stock in theS&P 500.

TSMC is the dominant manufacturer of AI chips and its hefty investment suggests it expects its customers to continue spending heavily for several years ahead.

Wei told analysts on the earnings call that the spending commitment was made after checks with major customers, and reflects verified demand. “If we didn’t do it carefully…that would be a big disaster to TSMC,” he said.

The sector might also be getting a boost from relief on the news that the Trump administration’s planned 25% tariff on imported chips will only be applied to chips shipped to the U.S. that aren’t used domestically for AI purposes but are then exported to another country.

While officials left the door open to a wider semiconductor tariff, companies that invest in U.S. chip production or invest in certain parts of the U.S. chip supply chain are likely to get preferential treatment. This would likely limit the scope of any potential tariffs.