Perhaps more than any other industry, the semiconductor chip industry is the business sector on which the modern world is built. No matter what device you’re reading this on, it wouldn’t be possible without semiconductors.
for a long time, Intel (NASDAQ: INTC) Once the undisputed world leader in semiconductor production, that title has now been eclipsed TSMC (NYSE:TSM).
If you’re looking for semiconductor investments in 2026, you should bet on the winners, not the also-rans.
The country of Taiwan is the last remnant of the former republican government of the Chinese Communist Party. 60% of the world’s semiconductor chips are produced here, and 90% of the most advanced chips are produced here.
Most of these chips are manufactured by Taiwan Semiconductor Manufacturing Company (TSMC). The company’s financials bear this out. In 2025, TSMC’s revenue will be US$121.3 billion, an increase of 37% from 2024. In the past three years, its revenue has grown at a compound annual growth rate (CAGR) of 20.48%. It also regularly beats earnings expectations and is incredibly profitable, with a gross profit margin of 58.98% and a net profit margin of 43.29%.
Also note that TSMC pays a dividend that yields 0.99% at current prices, which is impressive considering the stock is up 66% in the last 12 months. The company has grown its dividend at an annual rate of 12.3% over the past five years. Compared to Intel, it’s clear that TSMC is unlikely to relinquish its crown anytime soon.
Despite strong support from the U.S. government, Intel’s revenue has actually declined by an average of 8.4% over the past three years. Its gross profit margin is only 33%, and its net profit margin is only 0.37%. This means that from a net profit perspective, Intel is barely profitable. It’s also worth noting that Intel suspended its dividend at the end of 2024 and doesn’t appear to be planning to start paying dividends again anytime soon.
Intel’s trailing 12-month (TTM) revenue is less than half that of TSMC, and its TTM diluted earnings per share (EPS) is only $0.05 compared to TSMC’s $1.99, while TSMC holds almost three times as much cash as Intel, ranging from $90.25 billion to $30.94 billion.
