Taiwan Semiconductor Manufacturing has reported first-quarter revenue of NT$1.13 trillion (approximately $35.6 billion), a 35% increase compared to the same period last year. The chipmaking giant is benefiting from sustained demand for advanced semiconductors from key customers such as Apple and Nvidia.

Driven by demand for artificial intelligence chips, the company announced record quarterly revenue on Friday. According to analyst forecasts compiled by London Stock Exchange Group, revenue for the January to March period reached NT$1.13 trillion, exceeding market expectations of NT$1.12 trillion. In March alone, revenue hit NT$415.2 billion, a year-on-year increase of 45.2%.

Despite ongoing market concerns that conflict in the Middle East could disrupt supply chains and impact demand, the company continues to benefit from strong demand for advanced chips. An analyst from the industry analysis firm SemiAnalysis stated in an email, "We believe Taiwan Semiconductor Manufacturing will comfortably achieve its full-year growth target of 30%." The analyst added, "While the smartphone and personal computer end markets have been impacted by memory shortages, the company's AI business segment has driven growth."

Taiwan Semiconductor Manufacturing's foundry products cover a wide range of chips, from consumer electronics to data centers, and the company is a major beneficiary of the global multi-hundred-billion-dollar investment in AI infrastructure. It is one of the very few companies in the world capable of manufacturing the most advanced chips.

The analyst noted that reports indicate the company has increased prices for its most advanced chips, calling this a "significant factor" in the first-quarter revenue beat. The analyst also expects the company's first-quarter gross margin to reach 64%.

A growing number of companies are now designing their own chips, from hyperscale cloud providers like Google to Arm, which traditionally only provided semiconductor architecture but has now launched its own central processing unit. It has been reported that AI firm Anthropic is also exploring developing its own chips, alongside a host of startups launching new products for AI inference. The manufacturing of these chips primarily falls to Taiwan Semiconductor Manufacturing or competitors like Samsung and Intel.

While Taiwan Semiconductor Manufacturing reports monthly revenue figures, it rarely provides detailed commentary or profitability metrics at that time. The company will release its complete first-quarter financial report on April 16.

Investors are also looking ahead to next week's financial results from ASML, which is viewed as a bellwether for the semiconductor industry. The Dutch company manufactures equipment essential for producing the world's most advanced chips, including those made by Taiwan Semiconductor Manufacturing.