TSMC Crushed Despite Record Q2 Earnings as Market Questions AI Spending Sustainability

TSMC, the Taiwan-based semiconductor manufacturing company, has reported its best quarter ever in history. The company's revenue for Q2 2026 reached $40.2 billion, a 36% jump year-over-year. Net profit hit NT$706.56 billion, or roughly $21.99 billion, surging 77.4% compared to the same period last year.

TSMC also raised its full-year revenue growth outlook to slightly above 40%. However, despite these impressive numbers, TSMC shares fell approximately 4% in premarket trading following the earnings release on July 16. Other major chipmakers like NVIDIA, AMD, Intel, and Micron also declined between 1.3% and 2.7%

The semiconductor selloff spilled directly into crypto-adjacent equities, with IREN, Cipher Mining (CIFR), and TeraWulf (WULF) all dropping between 4% and 5%. The concern is that AI spending may not be sustainable, which could leave companies like TSMC with expensive excess capacity.