0945 GMT - TSMC's higher full-year revenue and capital expenditure guidance should ease concerns about the durability of AI demand and supply-chain bottlenecks, Morningstar analyst Phelix Lee says in a note. TSMC sees the AI semiconductor market moving beyond GPUs to include CPUs, custom AI ASICs, networking chips and others, as the ecosystem becomes much more diversified. TSMC also closely tracks customers' AI infrastructure build-outs, including power, site construction and deployment schedules, before committing capacity to ensure its chips won't turn into idle inventories. Lee reckons TSMC's higher capex guidance is a response to hyperscalers raising their 2027 budgets. Meanwhile, TSMC's confidence in expansion without bottlenecks is likely due to supplier ASML's plans to increase capacity by 30% in 2027 and another 30% in 2028, he says. (sherry.qin@wsj.com)

(END) Dow Jones Newswires

July 17, 2026 05:45 ET (09:45 GMT)

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