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- Nvidia Stock Falls Again as AI Chip Sell - Off Deepens Despite TSMC Record Profit and Robust Demand Outlook
Nvidia shares fell for a second straight day, down 2.3% to $216.16 by mid-morning Eastern time and about 11% below their 52-week high of $243.37. The sell-off has spread across AI and semiconductor stocks, with 20 of the sector's most valuable companies losing more than $1 trillion in market value this week, and South Korea's Kospi plunging more than 7%. TSMC reported a sixth straight quarter of record profit, with net income up nearly 69% and revenue up 51%, and forecast fourth-quarter sales of as much as $54.3 billion, yet its shares fell about 4% as gross margin slipped to 66.4%. Cited factors include higher rate expectations after the 3.7% inflation reading, financing concerns for AI infrastructure (CoreWeave's bond yields spiked toward 15%), and fears of memory-chip oversupply.
- TSMC stock sinks despite record profit amid 'extremely robust demand' for AI chips
TSMC (TSM) shares fell 4% even though the contract chipmaker posted a sixth straight quarter of record profit, with profit up nearly 69% and revenue up 51%, amid a deepening sector-wide sell-off. Sales for the current quarter are expected to reach as much as $54.3 billion, above analyst estimates. Third-quarter gross margin was 66.4%, down from 67.7% in the second quarter, and the company guides 65% to 67% for the fourth quarter. CEO C.C. Wei said demand for leading-edge technologies remains extremely robust, while CFO Wendell Huang reiterated a 2026 capital budget of $60 billion to $64 billion and said capex from 2026 to 2028 will be significantly higher than in the past three years. The stock is up more than 41% year to date and hit record highs earlier this month after Elon Musk acknowledged early talks on a possible collaboration on his Terafab chip initiative in Texas, which TSMC confirmed it is exploring alongside its Arizona expansion.
- TSMC Just Posted Record Profit for the Sixth Straight Quarter . Why Did the Stock Fall ?
TSMC reported third-quarter revenue up 50.9% to $46.7 billion, above the $45.7 billion consensus, with gross margin rising from 59.5% to 66.4% and adjusted earnings per share reaching $4.60 versus $4.46 expected. High-performance computing, mostly AI-related, made up 68% of revenue, and 3nm chips became its largest revenue source at 33%. Despite the strong results, TSMC shares fell 2.2% on Thursday afternoon after dropping more than 5% at one point, amid a broader AI-stock sell-off, with the VanEck Semiconductor ETF down 8.2% for the week and CoreWeave down 17.6%. CEO C.C. Wei warned that consumer and price-sensitive segments face challenges from rising component prices and macroeconomic uncertainty, while calling AI chip demand extremely robust.
- TSMC Just Posted Record Profit for the Sixth Straight Quarter. Why Did the Stock Fall?
TSMC reported third-quarter revenue up 50.9% to $46.7 billion, above the $45.7 billion consensus, with gross margin rising to 66.4% from 59.5% and adjusted EPS of $4.60 versus $2.92 a year earlier, beating estimates of $4.46. Advanced chips at 7nm and below made up 79% of revenue, while high-performance computing, mostly AI-related, reached 68%. CEO C.C. Wei said AI demand is very strong and rising with agentic AI, but warned that consumer and price-sensitive segments are being challenged by higher component prices and macro uncertainty. Despite the beat, the stock fell 2.2% on the day and more than 5% at one point, amid an AI-stock sell-off that week in which the VanEck Semiconductor ETF was down 8.2%.
- TSMC Just Posted Record Profit for the Sixth Straight Quarter. Why Did the Stock Fall?
TSMC reported third-quarter revenue up 50.9% to $46.7 billion, above the $45.7 billion consensus, with gross margin rising from 59.5% to 66.4% and adjusted EPS of $4.60 versus $4.46 expected. For the first time, 3nm chips were its largest revenue source at 33% of sales, and high-performance computing, mostly AI-related, made up 68%. CEO C.C. Wei described AI demand as very strong but warned that consumer and price-sensitive segments face pressure from rising component prices and macro uncertainty. Even so, TSMC shares fell 2.2% on Thursday afternoon and at one point more than 5%, amid a broader AI-stock sell-off in which CoreWeave dropped 17.6% and the VanEck Semiconductor ETF fell 8.2% over the week.
- TSMC posts record profit amid 'extremely robust demand' for AI chips
TSMC reported a sixth straight quarter of record profit, with its bottom line up nearly 69% and revenue up 51%, beating estimates, and it expects current-quarter sales of as much as $54.3 billion. CEO C.C. Wei said demand for leading-edge technologies remains 'extremely robust,' fueled by rising AI adoption as agentic AI emerges. Third-quarter gross margin eased to 66.4% from 67.7%, with fourth-quarter guidance of 65% to 67%. CFO Wendell Huang reiterated a 2026 capital budget of $60 billion to $64 billion and said capex from 2026 to 2028 will be significantly higher than in the past three years. Shares were set to open lower despite the results, after rising more than 41% year to date, and TSMC confirmed it is exploring Texas with Musk's Terafab chip initiative.
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- Super Micro (SMCI) Won Over $60 Billion in Orders, Is the Discount Deserved?
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- Is Nvidia Stock Really Trading for Just 8 Times 2030 Earnings?
Nvidia is the market's most valuable company, with a market cap above $5 trillion. It trades at 27 times adjusted trailing earnings, but only about 8 times analysts' estimate for fiscal 2030 earnings, a figure the author stresses is a moving target. Revenue growth accelerated from 56% in Q2 FY 2026 to 106% in Q2 FY 2027, though guidance points to a slight slowdown in the current quarter. The stock trades at 13 times next year's earnings, and the board recently authorized a record $150 billion in share repurchases. The author also acknowledges risks such as slower growth or contracting net margins.
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- NVIDIA Stock And 2 Other Undervalued Stocks To Own
Rising interest rates have pushed down bond prices, with 10-year U.S. Treasuries recording one of their steepest multi-year declines since the 18th century. The article highlights three U.S. stocks that a Simply Wall St cash flow screen considers attractively priced relative to their future cash flow potential: NVIDIA, Wells Fargo and J.B. Hunt Transport Services. NVIDIA generated about US$275.4b from Compute & Networking and US$27.6b from Graphics, with a market cap of US$5,170.6b, and the piece notes that an open-source or cheaper alternative to its CUDA platform could weaken its moat. Wells Fargo, with a market cap of US$251.7b, grew average loans 12% and average deposits 10% year over year in 2Q26 after the removal of its asset cap, while J.B. Hunt, with a market cap of US$21.3b and US$13.3b in revenue, recorded record intermodal volume of over 578,000 loads in Q2 2026.
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