Ming-Chi Kuo Dismisses Nvidia Order Cut Speculation Amid Intact AI Demand, Confirms TSMC Expansion On Track

Despite market speculation of a major reduction in Nvidia Corporation's NVDA 2025 Chip-On-Wafer-On-Substrate (CoWoS) wafer orders at Taiwan Semiconductor Manufacturing Co TSM, renowned analyst Ming-Chi Kuo has debunked the rumors, confirming that TSMC's expansion plans remain on track.

What Happened: Market chatter suggested that Nvidia's CoWoS wafer orders at TSMC had been cut from over 400,000 wafers to 380,000 wafers, fueling concerns about AI demand fluctuations.

However, on Monday, Kuo said that these rumors were likely based on misinterpretations of Nvidia's production strategy and exaggerated expectations of TSMC's capacity.

"Nvidia's CoWoS orders at TSMC for 2025 are approximately 370,000 wafers (variations within low single digits are considered normal range)," he said, adding, "TSMC’s CoWoS expansion plan remains unchanged … targeting approximately 70,000 wafers per month by December 2025."

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Kuo also pointed out that some market participants overestimated TSMC's CoWoS capacity and misinterpreted Nvidia's faster-than-expected transition from B200 to B300 series GPUs as a sign of order reductions.

My understanding is that TSMC always takes a highly cautious approach to capacity expansion. Unless there's a dramatic industry reversal in the short term, it's not easy to see significant order reductions (variations in the low to mid-single digits are considered reasonable, as… https://t.co/U5JB95OT2j

— 郭明錤 (Ming-Chi Kuo) (@mingchikuo) March 3, 2025

Why It's Important: The CoWoS process is critical to Nvidia's AI chip production, as it enables high-performance computing for GPUs used in data centers and AI models.

Kuo's report comes on the heels of Nvidia’s impressive fourth-quarter earnings. The AI chip giant reported fourth-quarter revenue of $39.3 billion, reflecting a 12% increase quarter-over-quarter and a 78% surge year-over-year.

The figure surpassed Wall Street's consensus estimate of $38.05 billion.

Meanwhile, TSMC reported fourth-quarter revenue of $26.88 billion (NT$868.46 billion), marking a 38.8% year-over-year increase and exceeding the analyst consensus estimate of $26.28 billion.

Price Action: Year to date, Nvidia stock is down 9.68%, while TSMC stock has declined 10.44%, according to Benzinga Pro data.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

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