Nvidia (NVDA, Financials)’s latest strong earnings update strengthens optimism for TSMC (TSM, Financials), with analysts predicting the company will continue to ride growth in the booming artificial intelligence space I’m doing it. Analysts such as Bank of America’s Brad Lin said demand for AI remains strong due to Nvidia’s predictable earnings. Lin noted that Nvidia’s stable product release cycle for data center GPUs puts TSMC in a good position, and ASP growth further solidifies the company’s position as an industry leader in semiconductor technology.
Citi analyst Chia Yi Chen also concluded that TSMC’s chip-on-wafer substrate production will double by 2025, especially due to Nvidia’s contribution in the AI weeding field. As the demand for higher-level AI models increases, TSMC is optimistic that it will benefit from the growing demand for high-end production capacity.
In addition to the increasing demand for AI technology, TSMC’s technological advantages position the company for further development in the coming years. Both analysts endorsed their view of good synergies between Nvidia and TSMC, faster pace of growth in product sales and consumer AI models, and TSMC’s increasing competitiveness in the semiconductor space.
This article first appeared on GuruFocus.
