Taiwan Semi's July Revenue Soars, Supporting These 5 Holdings
What we’re watching to confirm the seasonal pickup in demand is unfolding.
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Earlier this week, Foxconn HNHAF reported that its July revenue rose and indicated its cloud and networking products segment should maintain strong growth in the current quarter while its connected device segment should “enter the peak season in the second half of the year.” Those are positive comments for our holdings in Nvidia NVDA, Marvell MRVL, Apple AAPL, Qualcomm QCOM, and Universal Display OLED. To that, we can now add the almost 26% year-over-year (23% month over month) jump in Taiwan Semiconductor’s TSM July revenue.
Analyzing TSM’s monthly revenue cadence, historically, we’ve seen a sequential acceleration in July that drives favorable year-over-year growth figures in the next few months. That reflects ramping production schedules for new smartphone, PC, and other connected device models slated to hit shelves in time for the year-end holiday shopping season. In more recent years, it also reflects AI and data center chip demand, which, as we know, has experienced meaningful capital spending increases with more of the same ahead, per recent comments from Big Tech. That suggests we are likely to see an even stronger seasonal demand surge compared to the last few years.
Because one month does not make a trend, we will want to see the historical pattern play out with TSM’s August, September, and October revenue reports. Based on what we’ve seen so far from companies that have reported their June-quarter results, there is good reason to think that pattern will indeed repeat.
The degree to which there is upside relative to current market expectations will likely be determined when Nvidia reports and updates its outlook for the second half of 2025 on August 27. Added color from Marvell on August 28 and Broadcom AVGO on September 4 will help to further refine those expectations, as will company commentary made during the Goldman Sachs Communicopia + Technology conference that runs between September 8-12.
At the time of publication, TheStreet Pro Portfolio was long NVDA, MRVL, AAPL, QCOM and OLED.
