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TSMC 3Q26 First Take: results were solid, but the market wants clarity on 2027 and beyond. With monthly ops data already disclosed, revenue came in at $46.7bn (+41% YoY), ahead of the $45.8bn consensus. On a TWD basis, revenue growth was 51% this quarter.

Versus the pre-announced revenue, gross margin was the key focus. GPM was 66.4%, down 130bps QoQ and slightly below the Street at 66.8%. The pullback reflects the early drag from the 2nm ramp.

The market expects 2027 ASP hikes: advanced nodes (≤7nm) up about 5–10%, and mature nodes (≥N7) low single digits. Combined with the 2nm ramp, GPM should resume an uptrend.

With fabs running full, the company has stronger incentive to lift capex. It maintained 2026 capex at $60–64bn, unchanged from last quarter. This implies next-quarter capex of $19.3–23.4bn vs. $11.5bn a year ago, up 67–103% YoY.

Investors are watching management’s forward capex outlook. The market now pencils in roughly $85bn for 2027, about +35% YoY.

For next quarter, the company guides revenue of $52.3–54.3bn (above the $51.0bn Street) and GPM of 65–67% (Street at 66.8%). It raised its 2026 revenue growth outlook again to 44%, from slightly above 40% last quarter.

Repeated revenue beats underscore solid operations. With 2026 largely in the bag, investors care more about the 2027 outlook. A clear guide for 40%+ full-year growth in 2027 would provide the confidence the market seeks.

With the AI supply chain under pressure, the market is looking to TSMC to deliver a sufficiently explicit growth guide to lift sentiment. For more, follow Dolphin Research’s forthcoming takeaways and Trans. $Taiwan Semiconductor(TSM.US)