If you've been trying to get your hands on a 3nm chip from Taiwan Semiconductor (TSM), you're not alone — and you might want to brace for a higher bill. The company is reportedly considering a price hike of up to 15% for its 3nm foundry services in the second half of 2026, according to supply chain sources cited by TechNode. The reason? Demand, especially from AI, is growing faster than expected, and even a big capacity boost hasn't been enough to catch up.
Taiwan Semiconductor expanded its monthly 3nm production to 160,000-175,000 wafers in the second quarter, up from previous levels. But that extra output is being gobbled up almost immediately, leaving order backlogs intact. The bottleneck is centered at the company's Fab 18 complex in Taiwan's Southern Taiwan Science Park, where expansion efforts are ongoing but can't keep pace with insatiable AI demand.
This shortage of leading-edge manufacturing capacity is one of the semiconductor industry's most persistent supply chain headaches. And for Taiwan Semiconductor, it's a pricing power dream: when your customers can't get enough of your product, you can charge more.
Stock Performance and Technical Analysis
Shares edged up 0.27% in premarket trading Friday to $422.20, riding a broader tech rally that pushed Nasdaq and S&P 500 futures up about 0.5% each. Investors have been buying pullbacks, keeping the stock above key technical levels.
Over the past 12 months, Taiwan Semiconductor has gained a staggering 95.5%. The stock sits about 1.2% above its 20-day simple moving average of $418.30 and 28.3% above its 200-day moving average of $330.10. The technical setup remains bullish: the 20-day moving average is above the 50-day, and the golden cross that formed in June 2025 is still intact, reinforcing the long-term uptrend.
Momentum isn't flashing warning signs either. The relative strength index (RSI) is at 53.18, a neutral reading that suggests consolidation rather than overbought conditions. Key resistance is around $450, near the 52-week high, while support sits at $385, where buyers have stepped in before and where the 50-day moving average provides additional backing.
Earnings and Analyst Outlook
The next big catalyst is the company's earnings report, expected on July 16. Wall Street is looking for earnings per share of $3.69, up from $2.47 a year ago, on revenue of $39.76 billion, compared with $30.07 billion in the prior-year period. At roughly 36.2 times earnings, the stock carries a premium valuation, but strong growth expectations justify it.
Analysts remain broadly bullish. Barclays has a price target of $470, DA Davidson at $450, and Needham at $480. The consensus analyst forecast stands at $442.50, implying about 5% upside from current levels. With AI demand showing no signs of slowing and pricing power intact, Taiwan Semiconductor looks well-positioned to keep delivering.
