Viking Global Investors has significantly reduced its exposure to Taiwan Semiconductor Manufacturing Co (TSMC), cutting its shareholding by 29.0%.

According to a filing with the US Securities and Exchange Commission (SEC), the hedge fund's stake now stands at 3.2 million shares. The disclosure highlights a notable shift in the investor's position regarding the semiconductor manufacturer.

Filing Details

The reduction was reported through standard regulatory disclosures required for large institutional investors. No additional commentary or strategic rationale was provided in the filing excerpt.

Taiwan Semiconductor Manufacturing Company Ltd. (NYSE: TSM) reported consolidated revenue of approximately 467.58 billion New Taiwan dollars for July, marking a 44.7% year-over-year increase from 323.17 billion New Taiwan dollars in July 2025. The result underscores sustained market appetite for advanced chips driven by artificial intelligence spending, with shares rising 0.49% to $420.50 in premarket trading. This performance reinforces the company’s dominant position despite geopolitical pressures and China’s efforts to expand its domestic semiconductor capabilities.

Revenue also increased 5.6% month-over-month from June’s 442.68 billion New Taiwan dollars. For the first seven months of 2026, total revenue reached approximately 2.872 trillion New Taiwan dollars, up 37% from 2.096 trillion New Taiwan dollars during the same period in 2025. Analysts expect sales to grow by an average of 46.8% in the current quarter, aligning closely with the company’s raised outlook.

Capacity Expansion and Capital Expenditure

To support accelerated demand, Taiwan Semiconductor has raised its capital expenditure budget to a record range of $60 billion to $64 billion for the current year. Approximately 70% to 80% of this spending is allocated to advanced process technologies. The company targets 180,000 3nm wafers per month by the fourth quarter, months ahead of its original year-end goal. Monthly wafer output for the next-generation 2nm process is projected to approach 100,000 wafers by year-end.

Analyst Outlook and Competitive Edge

Baillie Gifford’s Paulina McPadden told Bloomberg that Taiwan Semiconductor remains a key leader in advanced chip manufacturing, highlighting an effective monopoly at the leading edge. She noted that decades of process knowledge provide an advantage that China will struggle to replicate, even as Beijing taps stock and bond markets to bankroll its AI ambitions. Export controls further hinder Chinese competitors’ access to necessary equipment. McPadden cited “exceptionally robust” AI-related demand following the company’s quarterly revenue of $40.2 billion.

Technical Analysis and Market Position

Taiwan Semiconductor remains in a longer-term uptrend, trading 16.2% above its 200-day simple moving average of $360.82 and 4.3% above its 100-day SMA of $401.78. However, the stock is 1.5% below its 50-day SMA of $425.75, which could act as resistance. The mixed setup suggests a consolidation phase following recent swing highs and lows.

ETF Exposure and Fund Flows

Taiwan Semiconductor’s performance is closely tied to major exchange-traded funds, which can amplify volatility. Significant weightings include:

• VanEck Semiconductor ETF (NASDAQ: SMH): 9.16%
• Nicholas Crypto Income ETF (NYSE: BLOX): 8.09%
• Lazard Emerging Markets Opportunities ETF (NYSE: EMKT): 7.45%

Large inflows or outflows in these funds directly impact demand for the stock. The analyst consensus remains a Buy with an average price forecast of $551.67 across 11 analysts.