TSMC ( (TSM) ) has fallen by -11.57%. Read on to learn why.
Taiwan Semiconductor Manufacturing Company (TSMC) experienced a notable decline in its stock price, dropping by 11.57% over the past week. This downturn can be attributed to several key factors, including the announcement of new tariffs by the Trump administration, which imposed a 32% tariff on Taiwan. This move has raised concerns about increased costs and potential disruptions in the semiconductor supply chain, affecting the broader tech market and the artificial intelligence sector.
In addition to the tariff concerns, TSMC’s recent tentative joint venture with Intel in the U.S. has also played a role in the stock’s volatility. While the collaboration aims to leverage Intel’s foundry facilities for advanced chip manufacturing, the market’s reaction was mixed. The partnership involves TSMC taking a 20% stake and sharing its chipmaking expertise with Intel, but it does not involve any capital infusion. This strategic move is part of a broader effort to position the U.S. as a leader in chipmaking, yet it has not been enough to offset the negative sentiment from the tariff announcement.
Despite the recent stock price decline, TSMC maintains a Strong Buy consensus rating from analysts, with an average price target suggesting significant upside potential. The company’s long-term prospects remain promising, particularly with its pivotal role in the global semiconductor industry. However, the immediate challenges posed by geopolitical tensions and trade policies continue to weigh heavily on investor sentiment, making it a critical period for TSMC and its stakeholders.