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Taiwan Semiconductor’s (NYSE:TSM) optimism for 2024 amid continued spending on artificial intelligence buoyed the broader semiconductor industry on Thursday.
The global foundry expects full-year sales to grow in the low- to mid-20% range this year in US dollar terms, CEO C.C. Wei said on the company earnings call.
“2023 was a challenging year for the global semiconductor industry but we also witnessed the rising emergence of generative AI related applications which TSMC as a key enabler,” Wei said.
Taiwan Semiconductor shares gained more than 7% in mid-day trading on Thursday, approaching levels not seen since early 2022.
The optimism surrounding AI spread to other semiconductor stocks, as Wolfe Research talked up AMD (AMD) and Qualcomm (QCOM). The firm said estimates for the pair may be too high for the first-quarter, but it’s possible that Wall Street estimates are too high.
“We do expect upside to AMD estimates in CY24/25 driven by share gains in server and optionality in AI (though we won’t join our peers in setting extreme expectations),” analyst Chris Caso wrote in a note.
AMD shares hit a record earlier on Thursday in part due to optimism surrounding its AI prospects.
Caso also upgraded Analog Devices (ADI), NXP Semiconductors (NXPI) and Microchip Technology (MCHP) going into fourth-quarter earnings as the firm has become “incrementally more constructive” on analog circuits.
Analog Devices, NXP Semiconductors and Microchip Technology moved higher on back of the upgrades.
Also seeing gains on Thursday were Intel (INTC), Texas Instruments (TXN) and Skyworks Solutions (SWKS) among others.