Apple Chip Supplier TSMC's Market-Cap Leapfrogs Above High-Profile Chinese Tech Stalwarts Tencent, Alibaba

Apple Inc AAPL chip supplier Taiwan Semiconductor Manufacturing Co. Ltd. TSM is making waves in the stock market.

TSMC - The Most Valued Chipmaker: TSMC is now the most valued chip manufacturer, towering over U.S.-based chip giants such as Nvidia Corporation NVDA and Intel Corporation INTC.

The Taiwanese foundry is a pureplay semiconductor manufacturer founded in 1987. It supplies to almost all fabless semiconductor companies such as Apple, Advanced Micro Devices, Inc. AMD, Qualcomm, Inc. QCOM and Broadcom Inc AVGO.

Apple is TSMC's largest client, with its chip orders for the iPhone, iPad and Apple Watch continuing to account for more than 20% of the foundry's total wafer revenue, the Digitimes reported, citing industry sources.

TSMC is capitalizing on the growing need for new power-efficient, sleek chips to fuel new-age technologies such as IoT, 5G and AI applications. The company also leads in terms of processor node technology.

TSMC is currently working on the most advanced 3nm chip manufacturing process, and mass production is reportedly set to begin in 2022.

Related Link: Why Apple Chip Supplier TSMC's Board Approved $2.8B Spending

Chinese Tech Titans Fall Behind: TSMC's strong business momentum has helped it overtake the valuation of China's tech heavyweights Tencent Holdings ADR TCEHY and Alibaba Group Holding Ltd - ADR BABA.

TSMC's market cap currently stands at roughly $579 billion compared to $544.13 billion for Tencent and $483 billion for Alibaba.

Tencent and Alibaba were once flying high, given their stronghold on the booming Chinese Internet industry. While the former focuses on gaming and messaging platforms, the latter has a dominant positioning in the domestic e-commerce market.

The shares of these companies have suffered in recent months amid the Chinese regulatory crackdown. China's Ministry of Industry and Information Technology blamed these companies for disrupting market order, damaging consumer rights and threatening data security.

After peaking at around $320 in Oct. 2020, Alibaba shares have pulled back notably and are currently trading around $175. With Tencent suffering the regulatory backlash much later, the stock began nosediving in February.

TSMC shares, though having retreated in February, have outperformed the Chinese companies.

At last check Tuesday at publication, TSMC shares were down 3.31% at $110.83.

Related Link: Apple Supplier TSMC Plans To Build Advanced Chip Packaging Plant In US: Report

Photo: Courtesy of TSMC