00:00 Speaker A

Taiwan semiconductor out with strong results, raising its forecast or at least saying it’s going to come in at the high end of its prior forecast. What stood out to you from those numbers?

00:15 Speaker B

I mean, this is the whole key behind why I am watching Taiwan Semi so closely now. It used to be kind of something that I’d watch at the periphery of what I do. And it’s because it is a harbinger of AI spending. And I think that’s smart that the company has gone out and said, are you you do really have these uh, you know, orders, well, maybe not in hand, but think they’re pretty accurate. And it’s very comforting to people who are investing in AI.

00:54 Speaker A

I mean, it seems like lately the sentiment has been swinging back in favor of CapX. So, you know, did that was this sort of another reassurance on that front?

01:08 Speaker C

Clearly a reassurance. The demand is insatiable. Here’s a data point at the beginning of this year, the bulls, and these are the bulls, not the bears, were expecting Taiwan semi to have 26 revenue growth of about 30%. Now it’ll be much higher than that. And if you analyze their guidance for this quarter, the quarter that we’re currently in, they are annualizing at a 46% run rate growth. So yes, this is a clear confirmation.

01:46 Speaker A

So a story came out about um Elon Musk really pushing his team forward on their chipmaking ability. Do you think that he’s going to really provide a viable competitor to some of the other chip makers? And, you know, what does that competitive landscape look like overall as well?

02:08 Speaker B

I think it’s really foolish to count uh Elon out in any kind of direction that he would go. And that’s largely because he has a track performance of doing the incredible. So, that being said, this is a matter of timing. It’s going to take a while to build this these fabs, design the the chip, you know, get everything right and start actually impacting the companies that do actually ship chips now. But there are a lot of companies that are trying to make their own brand and tailor the chips to how they’re using the compute. This is not new and I think everybody uh really understands that investing in this area. Taiwan Semi is a fabricator. So consider that that maybe Elon would contract with them for a while to as his um, you know, actual fab plant gets up and built. So there’s always that to consider as well.

02:59 Speaker C

I’m much more bearish on this announcement um than I guess the rest of the panel here. So first of all, maybe, and it won’t be anytime soon, they’ll be able to design chips, but if you’re going to manufacture chips, just leave it to Taiwan semi like everybody else does. I have uh very low confidence that even Elon Musk can pull this off. And then you’re getting into bed with Intel, and Intel’s best known for the last couple of decades at sucking at manufacturing. And you know, as an American, I’d love to see, you know, more semiconductor manufacturing uh domestically. However, very difficult to do, many years out, and the manufacturing uh portion of all this is even uh further out and yeah, I’m just when I read that that uh announcement, I’m thinking, I’ll believe it when I see it.