What's Going on with Taiwan Semiconductor Stock on Thursday?

Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM) stock fell almost 2% on Thursday as investors weighed fresh leadership and regulatory uncertainty across the broader AI supply chain against TSMC’s expanding AI investments and strong recent revenue growth.

The decline came even as the Technology sector rose 0.10% and the S&P 500 gained 0.13%, pointing to more semiconductor-specific pressure than a broad market selloff.

• Taiwan Semiconductor stock is under selling pressure. Why are TSM shares declining?

Nvidia Leadership Change Pressures AI Chip Names

NVIDIA Corp. (NASDAQ:NVDA) came under pressure after announcing the immediate resignation of CEO Jensen Huang.

The company named CFO Colette Kress interim CEO and appointed Harvey C. Jones as its first board chair while it searches for a permanent successor.

CNBC’s Jim Cramer said Huang’s exit "had to happen" and warned Nvidia stock could initially fall 10% to 15% as investigations continue.

The development added another source of uncertainty for companies tied closely to Nvidia and the AI semiconductor supply chain.

TSMC Remains a Key Nvidia Manufacturing Partner

Nvidia designs advanced chips, while TSMC manufactures those designs at scale.

The relationship also extends beyond chip production, with TSMC using Nvidia’s AI and computing platforms to improve semiconductor manufacturing processes.

That close connection leaves TSMC exposed to shifts in sentiment around NVIDIA even though the companies operate at different points of the semiconductor value chain.

TSMC Commits Up to $1 Billion to AI Companies

TSMC’s board on Tuesday approved investments totaling up to $1 billion in Anthropic and OpenAI.

The company authorized up to $500 million to buy Anthropic shares at its initial public offering price and another $500 million investment in OpenAI preferred stock.

Anthropic plans to list on the Nasdaq on Nov. 19 under the ticker ANT, while OpenAI has delayed a potential IPO until at least 2027.

The investments increase TSMC’s exposure to the expanding AI industry.

October Revenue Climbs Nearly 60%

TSMC also reported stronger October sales on Tuesday.

Revenue increased 59.7% year over year to 586.89 billion New Taiwan dollars ($17.88 billion) and rose 14.7% from September.

The company also plans to increase capital spending during 2026 through 2028 compared with the previous three-year period.

Technical Picture Shows Consolidation

TSMC trades about 4.7% below its 50-day SMA of $430.57 and 3.6% below its 100-day SMA of $425.79, while remaining roughly 1.9% above its 200-day SMA of $402.78.

The 20-day SMA remains below the 50-day SMA, pointing to weaker intermediate momentum even as the stock holds above its longer-term trend gauge.

Analyst Outlook

TSMC carries a Buy consensus rating with an average price forecast of $559.38.

Recent analyst actions include Bernstein raising its price target to $600 with an Outperform rating, Barclays raising its price target to $670 with an Overweight rating, and DA Davidson maintaining Buy with a $500 price target.

ETF Exposure

TSMC carries a 9.32% weighting in the VanEck Semiconductor ETF (NASDAQ:SMH), a 6.28% weighting in the Franklin Income Focus ETF (NYSE:INCM) and a 7.32% weighting in the Brown Advisory Flexible Equity ETF (NASDAQ:BAFE).

TSM Price Action

Taiwan Semiconductor shares were down 1.64% at $406.56 at the time of publication on Thursday, according to Benzinga Pro data.

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