What's Going On With Taiwan Semiconductor Stock On Thursday?

Taiwan Semiconductor Manufacturing Co TSM said it does not expect Super Typhoon Kong-rey typhoon to affect its operations.

The contract chipmaker has activated routine typhoon alert preparation procedures at all its factories and construction sites in advance, Reuters reports.

Earlier in October Hurricane Helene disrupted production of high-purity quartz at two leading North Carolina mines. Quartz is a critical component of the semiconductor industry.

The key Nvidia Corp NVDA supplier has been the target of geopolitical tensions between the U.S. and China, which Morris Chang, Taiwan Semiconductor’s co-founder, flagged as a considerable challenge for the company.

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Taiwan Semiconductor has also suspended chip shipments to two developers due to suspected ties with Chinese tech giant Huawei Technologies Co. The firms had ordered chips based on Taiwan Semiconductor’s 7nm process.

China remains a crucial market for Taiwan Semiconductor, contributing over 10% of its revenue, down from nearly 20% before Huawei’s export restrictions in 2020.

Meanwhile, Intel Corp INTC chief Pat Gelsinger’s comments on Taiwan’s geopolitical risks prompted Taiwan Semiconductor to retract its discounts for Intel, Reuters reports.

Intel had initially secured favorable pricing from Taiwan Semiconductor for its advanced 3-nanometer chips, which are essential to Intel’s manufacturing expansion.

However, Gelsinger’s remarks on Taiwan’s stability have strained the partnership, forcing Intel to pay the total price for Taiwan Semiconductor’s chips and shrinking potential profit margins on future projects, Reuters writes.

Recently, Republican presidential candidate Donald Trump accused Taiwan of undermining the U.S. chip industry for the second time and denounced the U.S. CHIPS Act. He pledged to impose tariffs on Taiwanese chips if he returned to the presidency.

Taiwan Semiconductor stock is up 92% year-to-date despite losing close to 3% in the last five days.

Price Action: At the last check on Thursday, TSM stock was trading lower by 0.80% at $192.92 premarket.

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