## TSM (TSMC) — filings-based deep dive (SEC 20-F + 6-K disclosures) **Executive takeaway:** TSMC’s 2024 mix shift toward High Performance Computing (HPC, including AI) is already visible in its disclosed platform revenue split (HPC was 51% of 2024 net revenue). ["High Performance Computing"](0001193125-25-083423|0) **Near-term framing:** The latest 6‑K disclosures (Jan 15, 2026) show Q4’25 revenue of **NT$1,046.09bn** and gross margin of **62.3%**, plus 1Q’26 revenue guidance of **US$34.6–35.8bn** and 2026 capex budget of **US$52–56bn**. ["NT$1,046.09 billion"](0001046179-26-000008|1) ["Gross margin for the quarter was 62.3%"](0001046179-26-000008|1) ["Revenue is expected to be between US$34.6 billion and US$35.8 billion"](0001046179-26-000008|1) ["2026 capital budget to be between US$52 billion and US$56 billion"](0001046179-26-000008|1) --- # 1) The “how TSM makes money” map (from disclosures) TSMC’s 20‑F frames demand through major end markets (HPC/AI, smartphones, IoT, automotive, digital consumer). ["HPC (including AI applications), smartphones, IoT, automotive"](0001193125-25-083423|0) A key *structural* point in the 20‑F is that semiconductor manufacturing has large fixed costs (fabs/equipment), so utilization swings can amplify margins (down in downturns, up in upturns). ["a significant portion of our operating costs is fixed"](0001193125-25-083423|0) ### A. Revenue by platform (what drives demand) (From 2024 Form 20‑F, year ended Dec 31) | Platform | 2022 net revenue (NT$ mn) | 2023 net revenue (NT$ mn) | 2024 net revenue (NT$ mn) | 2024 mix | |---|---:|---:|---:|---:| | High Performance Computing | 932,384 ["932,384"](0001193125-25-083423|0) | 934,769 ["934,769"](0001193125-25-083423|0) | 1,476,891 ["1,476,891"](0001193125-25-083423|0) | 51% ["51%"](0001193125-25-083423|0) | | Smartphone | 888,879 ["888,879"](0001193125-25-083423|0) | 814,914 ["814,914"](0001193125-25-083423|0) | 1,005,130 ["1,005,130"](0001193125-25-083423|0) | 35% ["35%"](0001193125-25-083423|0) | | Internet of Things | 196,115 ["196,115"](0001193125-25-083423|0) | 161,917 ["161,917"](0001193125-25-083423|0) | 165,516 ["165,516"](0001193125-25-083423|0) | 6% ["6%"](0001193125-25-083423|0) | | Automotive | 116,381 ["116,381"](0001193125-25-083423|0) | 133,654 ["133,654"](0001193125-25-083423|0) | 139,323 ["139,323"](0001193125-25-083423|0) | 5% ["5%"](0001193125-25-083423|0) | | Digital Consumer Electronics | 56,159 ["56,159"](0001193125-25-083423|0) | 47,000 ["47,000"](0001193125-25-083423|0) | 47,961 ["47,961"](0001193125-25-083423|0) | 1% ["1%"](0001193125-25-083423|0) | | Others | 73,973 ["73,973"](0001193125-25-083423|0) | 69,482 ["69,482"](0001193125-25-083423|0) | 59,487 ["59,487"](0001193125-25-083423|0) | 2% ["2%"](0001193125-25-083423|0) | | **Total** | 2,263,891 ["2,263,891"](0001193125-25-083423|0) | 2,161,736 ["2,161,736"](0001193125-25-083423|0) | 2,894,308 ["2,894,308"](0001193125-25-083423|0) | 100% ["100%"](0001193125-25-083423|0) | **What to watch here:** The company explicitly says the 2023→2024 increase “mainly came from” HPC (+NT$542,122mn) and Smartphones (+NT$190,216mn). ["mainly came from High Performance Computing"](0001193125-25-083423|0) ["from Smartphone of NT$190,216 million"](0001193125-25-083423|0) --- # 2) Geographic concentration (demand *location* lens) TSMC discloses that it categorizes net revenue mainly by **customer headquarters geography** (not necessarily ship-to). ["countries where our customers are headquartered"](0001193125-25-083423|0) ### Revenue by customer HQ region (20‑F) | Geography | 2022 net revenue (NT$ mn) | 2023 net revenue (NT$ mn) | 2024 net revenue (NT$ mn) | 2024 mix | |---|---:|---:|---:|---:| | North America | 1,534,642 ["1,534,642"](0001193125-25-083423|0) | 1,470,215 ["1,470,215"](0001193125-25-083423|0) | 2,031,326 ["2,031,326"](0001193125-25-083423|0) | 70% ["70%"](0001193125-25-083423|0) | | China | 245,169 ["245,169"](0001193125-25-083423|0) | 267,154 ["267,154"](0001193125-25-083423|0) | 331,673 ["331,673"](0001193125-25-083423|0) | 11% ["11%"](0001193125-25-083423|0) | | Asia Pacific (ex‑China/Japan) | 241,214 ["241,214"](0001193125-25-083423|0) | 174,947 ["174,947"](0001193125-25-083423|0) | 284,308 ["284,308"](0001193125-25-083423|0) | 10% ["10%"](0001193125-25-083423|0) | | EMEA | 123,767 ["123,767"](0001193125-25-083423|0) | 117,348 ["117,348"](0001193125-25-083423|0) | 102,761 ["102,761"](0001193125-25-083423|0) | 4% ["4%"](0001193125-25-083423|0) | | Japan | 119,099 ["119,099"](0001193125-25-083423|0) | 132,072 ["132,072"](0001193125-25-083423|0) | 144,240 ["144,240"](0001193125-25-083423|0) | 5% ["5%"](0001193125-25-083423|0) | | **Total** | 2,263,891 ["2,263,891"](0001193125-25-083423|0) | 2,161,736 ["2,161,736"](0001193125-25-083423|0) | 2,894,308 ["2,894,308"](0001193125-25-083423|0) | 100% ["100%"](0001193125-25-083423|0) | **Interpretation:** This disclosure makes North America the dominant “demand center” by customer HQ, which is consistent with the platform mix shift toward HPC/AI-heavy customers. ["North America"](0001193125-25-083423|0) ["High Performance Computing"](0001193125-25-083423|0) --- # 3) Customer concentration (the “who pays” risk) The 20‑F is unusually explicit about revenue concentration: top 10 customers were **76%** of 2024 net revenue; the largest customer was **22%**; the second largest was **12%**. ["ten largest customers in 2024 accounted for approximately, 76%"](0001193125-25-083423|0) ["largest customer in 2024 accounted for 22%"](0001193125-25-083423|0) ["second largest customer in 2024 accounted for"](0001193125-25-083423|0) ### Concentration snapshot (20‑F narrative) | Metric | 2022 | 2023 | 2024 | |---|---:|---:|---:| | Top 10 customers (% of net revenue) | ~68% ["68%"](0001193125-25-083423|0) | ~70% ["70%"](0001193125-25-083423|0) | ~76% ["76%"](0001193125-25-083423|0) | | Largest customer (% of net revenue) | 23% ["23%"](0001193125-25-083423|0) | 25% ["25%"](0001193125-25-083423|0) | 22% ["22%"](0001193125-25-083423|0) | | 2nd largest customer (% of net revenue) | <10% ["less than 10%"](0001193125-25-083423|0) | 11% ["11%"](0001193125-25-083423|0) | 12% ["12%"](0001193125-25-083423|0) | ### “≥10% customers” table (20‑F footnote disclosure) TSMC also provides an accounting footnote view with anonymized “Customer A/B/C” meeting (or not meeting) the 10% threshold. ["Major customers representing at least 10%"](0001193125-25-083423|0) | Customer label | 2022 amount (NT$ mn) | 2022 % | 2023 amount (NT$ mn) | 2023 % | 2024 amount (NT$ mn) | 2024 % | |---|---:|---:|---:|---:|---:|---:| | Customer A | 529,649.2 ["529,649.2"](0001193125-25-083423|0) | 23% ["23"](0001193125-25-083423|0) | 546,550.9 ["546,550.9"](0001193125-25-083423|0) | 25% ["25"](0001193125-25-083423|0) | 624,345.5 ["624,345.5"](0001193125-25-083423|0) | 22% ["22"](0001193125-25-083423|0) | | Customer B | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | 352,271.2 ["352,271.2"](0001193125-25-083423|0) | 12% ["12"](0001193125-25-083423|0) | | Customer C | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | 241,152.4 ["241,152.4"](0001193125-25-083423|0) | 11% ["11"](0001193125-25-083423|0) | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | **Why it matters:** TSMC itself flags that concentration can increase exposure to seasonal demand swings and customer inventory adjustments, and that further customer consolidation could worsen concentration. ["A more concentrated customer base"](0001193125-25-083423|0) ["customer inventory adjustments"](0001193125-25-083423|0) --- # 4) Technology & node mix (competitive moat lens) ### A. Roadmap statement (2nm timing + 3nm status) TSMC states in the 20‑F that **3‑nanometer entered volume production in 2022** and that **2‑nanometer volume production is expected in 2025**. ["3-nanometer technology successfully entered volume production in 2022"](0001193125-25-083423|0) ["volume production is expected in 2025"](0001193125-25-083423|0) ### B. Latest disclosed leading-edge mix (Q4’25 wafer revenue mix) From the Jan 15, 2026 6‑K press release (Q4’25): - 3nm = **28%** of total wafer revenue - 5nm = **35%** - 7nm = **14%** - “Advanced technologies” (7nm and more advanced) = **77%** ["3-nanometer accounted for 28%"](0001046179-26-000008|1) ["5-nanometer accounted for 35%"](0001046179-26-000008|1) ["7-nanometer accounted for 14%"](0001046179-26-000008|1) ["accounted for 77%"](0001046179-26-000008|1) **How to use this:** If 3nm/5nm are growing, you typically expect (i) stronger pricing power, but also (ii) heavier depreciation burden from new toolsets—TSMC explicitly links higher D&A to “continuing investment in production capacity for advanced technologies.” ["depreciation and amortization expenses"](0001193125-25-083423|0) ["advanced technologies"](0001193125-25-083423|0) --- # 5) Capital intensity, cash generation, and the capex “engine” ### A. Historical capex (20‑F) + forward capex framing TSMC discloses 2022–2024 capex in NT$ and a 2025 capex outlook in US$. ["Our capital expenditures in 2022, 2023 and 2024 were"](0001193125-25-083423|0) ["capital expenditures in 2025 are expected to be between US$38 billion and US$42 billion"](0001193125-25-083423|0) | Capex | 2022 | 2023 | 2024 | |---|---:|---:|---:| | Capital expenditures (NT$ mn) | 1,082,672 ["NT$1,082,672 million"](0001193125-25-083423|0) | 949,817 ["NT$949,817 million"](0001193125-25-083423|0) | 956,007 ["NT$956,007 million"](0001193125-25-083423|0) | **Where they said 2025 capex goes:** leading-edge (2nm/3nm/5nm), specialty + advanced packaging, and R&D for new technologies. ["2-nanometer, 3-nanometer and 5-nanometer"](0001193125-25-083423|0) ["specialty technologies and advanced packaging"](0001193125-25-083423|0) ["investing in research and development"](0001193125-25-083423|0) ### B. Cash flow snapshot (20‑F) | Cash flow line (NT$ mn) | 2022 | 2023 | 2024 | |---|---:|---:|---:| | Net cash generated by operating activities | 1,610,599 ["1,610,599"](0001193125-25-083423|0) | 1,241,967 ["1,241,967"](0001193125-25-083423|0) | 1,826,177 ["1,826,177"](0001193125-25-083423|0) | | Net cash used in investing activities | (1,190,928) ["(1,190,928"](0001193125-25-083423|0) | (906,120) ["(906,120"](0001193125-25-083423|0) | (864,843) ["(864,843"](0001193125-25-083423|0) | | Net cash used in financing activities | (200,244) ["(200,244"](0001193125-25-083423|0) | (204,894) ["(204,894"](0001193125-25-083423|0) | (346,301) ["(346,301"](0001193125-25-083423|0) | **Management liquidity claim:** The 20‑F states they believe cash from operations + cash/marketable securities + capital markets access are sufficient for the next 12 months’ needs (working capital, capex, debt, dividends, etc.). ["will be sufficient to fund"](0001193125-25-083423|0) ### C. Newest capex anchor: 2026 capital budget (6‑K) TSMC’s Jan 15, 2026 6‑K says: “2026 capital budget to be between US$52 billion and US$56 billion.” ["2026 capital budget"](0001046179-26-000008|1) --- # 6) “Latest quarter” scoreboard (Q4’25 + FY2025 highlights) ### A. Q4’25 headline metrics (6‑K press release, prepared under TIFRS) | Metric | Q4’25 | Q4’24 | Y/Y | Q3’25 | Q/Q | |---|---:|---:|---:|---:|---:| | Revenue (NT$ bn) | 1,046.09 ["NT$1,046.09 billion"](0001046179-26-000008|1) | 868.46 ["868,461"](0001046179-26-000008|1) | +20.5% ["increased 20.5%"](0001046179-26-000008|1) | 989.92 ["989,918"](0001046179-26-000008|1) | +5.7% ["5.7% increase"](0001046179-26-000008|1) | | Net income (NT$ bn) | 505.74 ["net income of NT$505.74 billion"](0001046179-26-000008|1) | 374.68 ["374,680"](0001046179-26-000008|1) | +35.0% ["increased 35.0%"](0001046179-26-000008|1) | 452.30 ["452,302"](0001046179-26-000008|1) | +11.8% ["11.8% increase"](0001046179-26-000008|1) | | Gross margin | 62.3% ["Gross margin for the quarter was 62.3%"](0001046179-26-000008|1) | — | — | — | — | | Operating margin | 54.0% ["operating margin was 54.0%"](0001046179-26-000008|1) | — | — | — | — | | Diluted EPS (NT$) | 19.50 ["diluted earnings per share of NT$19.50"](0001046179-26-000008|1) | 14.45 ["14.45"](0001046179-26-000008|1) | +35.0% ["increased 35.0%"](0001046179-26-000008|1) | 17.44 ["17.44"](0001046179-26-000008|1) | +11.8% ["11.8%"](0001046179-26-000008|1) | ### B. FY2025 “Financial Highlights” slide (6‑K investor deck) | Metric | 2025 | 2024 | Y/Y | |---|---:|---:|---:| | Net revenue (US$ bn) | 122.42 ["Net Revenue (US$ billions) 122.42"](0001046179-26-000008|2) | 90.08 ["90.08"](0001046179-26-000008|2) | +35.9% ["+35.9%"](0001046179-26-000008|2) | | Net revenue (NT$ bn) | 3,809.05 ["Net Revenue 3,809.05"](0001046179-26-000008|2) | 2,894.31 ["2,894.31"](0001046179-26-000008|2) | +31.6% ["+31.6%"](0001046179-26-000008|2) | | Gross margin | 59.9% ["Gross Margin 59.9%"](0001046179-26-000008|2) | 56.1% ["56.1%"](0001046179-26-000008|2) | +3.8 ppts ["+3.8ppts"](0001046179-26-000008|2) | | Operating margin | 50.8% ["Operating Margin 50.8%"](0001046179-26-000008|2) | 45.7% ["45.7%"](0001046179-26-000008|2) | +5.1 ppts ["+5.1ppts"](0001046179-26-000008|2) | | Capex (NT$ bn) | 1,272.41 ["Capital Expenditures 1,272.41"](0001046179-26-000008|2) | 956.01 ["956.01"](0001046179-26-000008|2) | +33.1% ["+33.1%"](0001046179-26-000008|2) | --- # 7) Risk register (what TSM itself emphasizes) Below are “filing-native” risks that matter because they’re either structural or repeatedly highlighted: 1) **Customer concentration risk** (top 10 = 76% of 2024 revenue). ["76% of our net revenue"](0001193125-25-083423|0) 2) **Geopolitics / trade barriers / export controls** can increase costs, restrict supplies, or limit ability to sell in markets. ["sanctions and import and export controls"](0001193125-25-083423|0) 3) **Cybersecurity & IT resilience** (risk of severe interruption/shutdown). ["severely interrupted or even shut down"](0001193125-25-083423|0) 4) **Capacity planning execution risk** (expansion costs can rise materially; demand forecasts can change quickly). ["continued to add capacity"](0001193125-25-083423|0) ["increases may be substantial"](0001193125-25-083423|0) 5) **FX sensitivity**: sales mainly in USD; >half capex in non‑NTD; they quantify that a 1% USD depreciation vs NTD could reduce operating margin by ~0.4 ppt (based on 2024). ["every 1% depreciation"](0001193125-25-083423|0) ["0.4 percentage point decrease"](0001193125-25-083423|0) --- # 8) Make this “interactive”: choose a module to expand next Reply with any **one** of the commands below and I’ll expand that module using *only* additional filing/disclosure pulls (more tables, more direct citations): - **`TSM: deep dive unit economics`** (gross margin drivers, depreciation, utilization logic, and how capex flows through) - **`TSM: deep dive customers & concentration`** (customer A/B/C footnotes + concentration mechanics + receivables concentration) - **`TSM: deep dive AI/HPC`** (HPC platform share, what the 20‑F says about AI demand dynamics, and what it implies operationally) - **`TSM: deep dive capex & global footprint`** (Taiwan vs overseas expansion references, plus capex focus areas and timelines) - **`TSM: deep dive technology roadmap`** (2nm/3nm statements + how node mix showed up in Q4’25 disclosures) If you don’t choose, the default next step is I’ll expand **unit economics + capex** (because it’s the core driver of TSM’s through-cycle earnings power).

## TSM (TSMC) — filings-based deep dive (SEC 20-F + 6-K disclosures) **Executive takeaway:** TSMC’s 2024 mix shift toward High Performance Computing (HPC, including AI) is already visible in its disclosed platform revenue split (HPC was 51% of 2024 net revenue). ["High Performance Computing"](0001193125-25-083423|0) **Near-term framing:** The latest 6‑K disclosures (Jan 15, 2026) show Q4’25 revenue of **NT$1,046.09bn** and gross margin of **62.3%**, plus 1Q’26 revenue guidance of **US$34.6–35.8bn** and 2026 capex budget of **US$52–56bn**. ["NT$1,046.09 billion"](0001046179-26-000008|1) ["Gross margin for the quarter was 62.3%"](0001046179-26-000008|1) ["Revenue is expected to be between US$34.6 billion and US$35.8 billion"](0001046179-26-000008|1) ["2026 capital budget to be between US$52 billion and US$56 billion"](0001046179-26-000008|1) --- # 1) The “how TSM makes money” map (from disclosures) TSMC’s 20‑F frames demand through major end markets (HPC/AI, smartphones, IoT, automotive, digital consumer). ["HPC (including AI applications), smartphones, IoT, automotive"](0001193125-25-083423|0) A key *structural* point in the 20‑F is that semiconductor manufacturing has large fixed costs (fabs/equipment), so utilization swings can amplify margins (down in downturns, up in upturns). ["a significant portion of our operating costs is fixed"](0001193125-25-083423|0) ### A. Revenue by platform (what drives demand) (From 2024 Form 20‑F, year ended Dec 31) | Platform | 2022 net revenue (NT$ mn) | 2023 net revenue (NT$ mn) | 2024 net revenue (NT$ mn) | 2024 mix | |---|---:|---:|---:|---:| | High Performance Computing | 932,384 ["932,384"](0001193125-25-083423|0) | 934,769 ["934,769"](0001193125-25-083423|0) | 1,476,891 ["1,476,891"](0001193125-25-083423|0) | 51% ["51%"](0001193125-25-083423|0) | | Smartphone | 888,879 ["888,879"](0001193125-25-083423|0) | 814,914 ["814,914"](0001193125-25-083423|0) | 1,005,130 ["1,005,130"](0001193125-25-083423|0) | 35% ["35%"](0001193125-25-083423|0) | | Internet of Things | 196,115 ["196,115"](0001193125-25-083423|0) | 161,917 ["161,917"](0001193125-25-083423|0) | 165,516 ["165,516"](0001193125-25-083423|0) | 6% ["6%"](0001193125-25-083423|0) | | Automotive | 116,381 ["116,381"](0001193125-25-083423|0) | 133,654 ["133,654"](0001193125-25-083423|0) | 139,323 ["139,323"](0001193125-25-083423|0) | 5% ["5%"](0001193125-25-083423|0) | | Digital Consumer Electronics | 56,159 ["56,159"](0001193125-25-083423|0) | 47,000 ["47,000"](0001193125-25-083423|0) | 47,961 ["47,961"](0001193125-25-083423|0) | 1% ["1%"](0001193125-25-083423|0) | | Others | 73,973 ["73,973"](0001193125-25-083423|0) | 69,482 ["69,482"](0001193125-25-083423|0) | 59,487 ["59,487"](0001193125-25-083423|0) | 2% ["2%"](0001193125-25-083423|0) | | **Total** | 2,263,891 ["2,263,891"](0001193125-25-083423|0) | 2,161,736 ["2,161,736"](0001193125-25-083423|0) | 2,894,308 ["2,894,308"](0001193125-25-083423|0) | 100% ["100%"](0001193125-25-083423|0) | **What to watch here:** The company explicitly says the 2023→2024 increase “mainly came from” HPC (+NT$542,122mn) and Smartphones (+NT$190,216mn). ["mainly came from High Performance Computing"](0001193125-25-083423|0) ["from Smartphone of NT$190,216 million"](0001193125-25-083423|0) --- # 2) Geographic concentration (demand *location* lens) TSMC discloses that it categorizes net revenue mainly by **customer headquarters geography** (not necessarily ship-to). ["countries where our customers are headquartered"](0001193125-25-083423|0) ### Revenue by customer HQ region (20‑F) | Geography | 2022 net revenue (NT$ mn) | 2023 net revenue (NT$ mn) | 2024 net revenue (NT$ mn) | 2024 mix | |---|---:|---:|---:|---:| | North America | 1,534,642 ["1,534,642"](0001193125-25-083423|0) | 1,470,215 ["1,470,215"](0001193125-25-083423|0) | 2,031,326 ["2,031,326"](0001193125-25-083423|0) | 70% ["70%"](0001193125-25-083423|0) | | China | 245,169 ["245,169"](0001193125-25-083423|0) | 267,154 ["267,154"](0001193125-25-083423|0) | 331,673 ["331,673"](0001193125-25-083423|0) | 11% ["11%"](0001193125-25-083423|0) | | Asia Pacific (ex‑China/Japan) | 241,214 ["241,214"](0001193125-25-083423|0) | 174,947 ["174,947"](0001193125-25-083423|0) | 284,308 ["284,308"](0001193125-25-083423|0) | 10% ["10%"](0001193125-25-083423|0) | | EMEA | 123,767 ["123,767"](0001193125-25-083423|0) | 117,348 ["117,348"](0001193125-25-083423|0) | 102,761 ["102,761"](0001193125-25-083423|0) | 4% ["4%"](0001193125-25-083423|0) | | Japan | 119,099 ["119,099"](0001193125-25-083423|0) | 132,072 ["132,072"](0001193125-25-083423|0) | 144,240 ["144,240"](0001193125-25-083423|0) | 5% ["5%"](0001193125-25-083423|0) | | **Total** | 2,263,891 ["2,263,891"](0001193125-25-083423|0) | 2,161,736 ["2,161,736"](0001193125-25-083423|0) | 2,894,308 ["2,894,308"](0001193125-25-083423|0) | 100% ["100%"](0001193125-25-083423|0) | **Interpretation:** This disclosure makes North America the dominant “demand center” by customer HQ, which is consistent with the platform mix shift toward HPC/AI-heavy customers. ["North America"](0001193125-25-083423|0) ["High Performance Computing"](0001193125-25-083423|0) --- # 3) Customer concentration (the “who pays” risk) The 20‑F is unusually explicit about revenue concentration: top 10 customers were **76%** of 2024 net revenue; the largest customer was **22%**; the second largest was **12%**. ["ten largest customers in 2024 accounted for approximately, 76%"](0001193125-25-083423|0) ["largest customer in 2024 accounted for 22%"](0001193125-25-083423|0) ["second largest customer in 2024 accounted for"](0001193125-25-083423|0) ### Concentration snapshot (20‑F narrative) | Metric | 2022 | 2023 | 2024 | |---|---:|---:|---:| | Top 10 customers (% of net revenue) | ~68% ["68%"](0001193125-25-083423|0) | ~70% ["70%"](0001193125-25-083423|0) | ~76% ["76%"](0001193125-25-083423|0) | | Largest customer (% of net revenue) | 23% ["23%"](0001193125-25-083423|0) | 25% ["25%"](0001193125-25-083423|0) | 22% ["22%"](0001193125-25-083423|0) | | 2nd largest customer (% of net revenue) | <10% ["less than 10%"](0001193125-25-083423|0) | 11% ["11%"](0001193125-25-083423|0) | 12% ["12%"](0001193125-25-083423|0) | ### “≥10% customers” table (20‑F footnote disclosure) TSMC also provides an accounting footnote view with anonymized “Customer A/B/C” meeting (or not meeting) the 10% threshold. ["Major customers representing at least 10%"](0001193125-25-083423|0) | Customer label | 2022 amount (NT$ mn) | 2022 % | 2023 amount (NT$ mn) | 2023 % | 2024 amount (NT$ mn) | 2024 % | |---|---:|---:|---:|---:|---:|---:| | Customer A | 529,649.2 ["529,649.2"](0001193125-25-083423|0) | 23% ["23"](0001193125-25-083423|0) | 546,550.9 ["546,550.9"](0001193125-25-083423|0) | 25% ["25"](0001193125-25-083423|0) | 624,345.5 ["624,345.5"](0001193125-25-083423|0) | 22% ["22"](0001193125-25-083423|0) | | Customer B | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | 352,271.2 ["352,271.2"](0001193125-25-083423|0) | 12% ["12"](0001193125-25-083423|0) | | Customer C | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | 241,152.4 ["241,152.4"](0001193125-25-083423|0) | 11% ["11"](0001193125-25-083423|0) | <10% (NA) ["NA (Note)"](0001193125-25-083423|0) | NA ["NA"](0001193125-25-083423|0) | **Why it matters:** TSMC itself flags that concentration can increase exposure to seasonal demand swings and customer inventory adjustments, and that further customer consolidation could worsen concentration. ["A more concentrated customer base"](0001193125-25-083423|0) ["customer inventory adjustments"](0001193125-25-083423|0) --- # 4) Technology & node mix (competitive moat lens) ### A. Roadmap statement (2nm timing + 3nm status) TSMC states in the 20‑F that **3‑nanometer entered volume production in 2022** and that **2‑nanometer volume production is expected in 2025**. ["3-nanometer technology successfully entered volume production in 2022"](0001193125-25-083423|0) ["volume production is expected in 2025"](0001193125-25-083423|0) ### B. Latest disclosed leading-edge mix (Q4’25 wafer revenue mix) From the Jan 15, 2026 6‑K press release (Q4’25): - 3nm = **28%** of total wafer revenue - 5nm = **35%** - 7nm = **14%** - “Advanced technologies” (7nm and more advanced) = **77%** ["3-nanometer accounted for 28%"](0001046179-26-000008|1) ["5-nanometer accounted for 35%"](0001046179-26-000008|1) ["7-nanometer accounted for 14%"](0001046179-26-000008|1) ["accounted for 77%"](0001046179-26-000008|1) **How to use this:** If 3nm/5nm are growing, you typically expect (i) stronger pricing power, but also (ii) heavier depreciation burden from new toolsets—TSMC explicitly links higher D&A to “continuing investment in production capacity for advanced technologies.” ["depreciation and amortization expenses"](0001193125-25-083423|0) ["advanced technologies"](0001193125-25-083423|0) --- # 5) Capital intensity, cash generation, and the capex “engine” ### A. Historical capex (20‑F) + forward capex framing TSMC discloses 2022–2024 capex in NT$ and a 2025 capex outlook in US$. ["Our capital expenditures in 2022, 2023 and 2024 were"](0001193125-25-083423|0) ["capital expenditures in 2025 are expected to be between US$38 billion and US$42 billion"](0001193125-25-083423|0) | Capex | 2022 | 2023 | 2024 | |---|---:|---:|---:| | Capital expenditures (NT$ mn) | 1,082,672 ["NT$1,082,672 million"](0001193125-25-083423|0) | 949,817 ["NT$949,817 million"](0001193125-25-083423|0) | 956,007 ["NT$956,007 million"](0001193125-25-083423|0) | **Where they said 2025 capex goes:** leading-edge (2nm/3nm/5nm), specialty + advanced packaging, and R&D for new technologies. ["2-nanometer, 3-nanometer and 5-nanometer"](0001193125-25-083423|0) ["specialty technologies and advanced packaging"](0001193125-25-083423|0) ["investing in research and development"](0001193125-25-083423|0) ### B. Cash flow snapshot (20‑F) | Cash flow line (NT$ mn) | 2022 | 2023 | 2024 | |---|---:|---:|---:| | Net cash generated by operating activities | 1,610,599 ["1,610,599"](0001193125-25-083423|0) | 1,241,967 ["1,241,967"](0001193125-25-083423|0) | 1,826,177 ["1,826,177"](0001193125-25-083423|0) | | Net cash used in investing activities | (1,190,928) ["(1,190,928"](0001193125-25-083423|0) | (906,120) ["(906,120"](0001193125-25-083423|0) | (864,843) ["(864,843"](0001193125-25-083423|0) | | Net cash used in financing activities | (200,244) ["(200,244"](0001193125-25-083423|0) | (204,894) ["(204,894"](0001193125-25-083423|0) | (346,301) ["(346,301"](0001193125-25-083423|0) | **Management liquidity claim:** The 20‑F states they believe cash from operations + cash/marketable securities + capital markets access are sufficient for the next 12 months’ needs (working capital, capex, debt, dividends, etc.). ["will be sufficient to fund"](0001193125-25-083423|0) ### C. Newest capex anchor: 2026 capital budget (6‑K) TSMC’s Jan 15, 2026 6‑K says: “2026 capital budget to be between US$52 billion and US$56 billion.” ["2026 capital budget"](0001046179-26-000008|1) --- # 6) “Latest quarter” scoreboard (Q4’25 + FY2025 highlights) ### A. Q4’25 headline metrics (6‑K press release, prepared under TIFRS) | Metric | Q4’25 | Q4’24 | Y/Y | Q3’25 | Q/Q | |---|---:|---:|---:|---:|---:| | Revenue (NT$ bn) | 1,046.09 ["NT$1,046.09 billion"](0001046179-26-000008|1) | 868.46 ["868,461"](0001046179-26-000008|1) | +20.5% ["increased 20.5%"](0001046179-26-000008|1) | 989.92 ["989,918"](0001046179-26-000008|1) | +5.7% ["5.7% increase"](0001046179-26-000008|1) | | Net income (NT$ bn) | 505.74 ["net income of NT$505.74 billion"](0001046179-26-000008|1) | 374.68 ["374,680"](0001046179-26-000008|1) | +35.0% ["increased 35.0%"](0001046179-26-000008|1) | 452.30 ["452,302"](0001046179-26-000008|1) | +11.8% ["11.8% increase"](0001046179-26-000008|1) | | Gross margin | 62.3% ["Gross margin for the quarter was 62.3%"](0001046179-26-000008|1) | — | — | — | — | | Operating margin | 54.0% ["operating margin was 54.0%"](0001046179-26-000008|1) | — | — | — | — | | Diluted EPS (NT$) | 19.50 ["diluted earnings per share of NT$19.50"](0001046179-26-000008|1) | 14.45 ["14.45"](0001046179-26-000008|1) | +35.0% ["increased 35.0%"](0001046179-26-000008|1) | 17.44 ["17.44"](0001046179-26-000008|1) | +11.8% ["11.8%"](0001046179-26-000008|1) | ### B. FY2025 “Financial Highlights” slide (6‑K investor deck) | Metric | 2025 | 2024 | Y/Y | |---|---:|---:|---:| | Net revenue (US$ bn) | 122.42 ["Net Revenue (US$ billions) 122.42"](0001046179-26-000008|2) | 90.08 ["90.08"](0001046179-26-000008|2) | +35.9% ["+35.9%"](0001046179-26-000008|2) | | Net revenue (NT$ bn) | 3,809.05 ["Net Revenue 3,809.05"](0001046179-26-000008|2) | 2,894.31 ["2,894.31"](0001046179-26-000008|2) | +31.6% ["+31.6%"](0001046179-26-000008|2) | | Gross margin | 59.9% ["Gross Margin 59.9%"](0001046179-26-000008|2) | 56.1% ["56.1%"](0001046179-26-000008|2) | +3.8 ppts ["+3.8ppts"](0001046179-26-000008|2) | | Operating margin | 50.8% ["Operating Margin 50.8%"](0001046179-26-000008|2) | 45.7% ["45.7%"](0001046179-26-000008|2) | +5.1 ppts ["+5.1ppts"](0001046179-26-000008|2) | | Capex (NT$ bn) | 1,272.41 ["Capital Expenditures 1,272.41"](0001046179-26-000008|2) | 956.01 ["956.01"](0001046179-26-000008|2) | +33.1% ["+33.1%"](0001046179-26-000008|2) | --- # 7) Risk register (what TSM itself emphasizes) Below are “filing-native” risks that matter because they’re either structural or repeatedly highlighted: 1) **Customer concentration risk** (top 10 = 76% of 2024 revenue). ["76% of our net revenue"](0001193125-25-083423|0) 2) **Geopolitics / trade barriers / export controls** can increase costs, restrict supplies, or limit ability to sell in markets. ["sanctions and import and export controls"](0001193125-25-083423|0) 3) **Cybersecurity & IT resilience** (risk of severe interruption/shutdown). ["severely interrupted or even shut down"](0001193125-25-083423|0) 4) **Capacity planning execution risk** (expansion costs can rise materially; demand forecasts can change quickly). ["continued to add capacity"](0001193125-25-083423|0) ["increases may be substantial"](0001193125-25-083423|0) 5) **FX sensitivity**: sales mainly in USD; >half capex in non‑NTD; they quantify that a 1% USD depreciation vs NTD could reduce operating margin by ~0.4 ppt (based on 2024). ["every 1% depreciation"](0001193125-25-083423|0) ["0.4 percentage point decrease"](0001193125-25-083423|0) --- # 8) Make this “interactive”: choose a module to expand next Reply with any **one** of the commands below and I’ll expand that module using *only* additional filing/disclosure pulls (more tables, more direct citations): - **`TSM: deep dive unit economics`** (gross margin drivers, depreciation, utilization logic, and how capex flows through) - **`TSM: deep dive customers & concentration`** (customer A/B/C footnotes + concentration mechanics + receivables concentration) - **`TSM: deep dive AI/HPC`** (HPC platform share, what the 20‑F says about AI demand dynamics, and what it implies operationally) - **`TSM: deep dive capex & global footprint`** (Taiwan vs overseas expansion references, plus capex focus areas and timelines) - **`TSM: deep dive technology roadmap`** (2nm/3nm statements + how node mix showed up in Q4’25 disclosures) If you don’t choose, the default next step is I’ll expand **unit economics + capex** (because it’s the core driver of TSM’s through-cycle earnings power).