TSM stock rose on Tuesday, extending a rally that began late last week after the U.S. Commerce Department granted a one-year export license allowing Taiwan Semiconductor to continue importing American chipmaking equipment for its mainland China operations. The license alleviates near-term operational uncertainty for TSM’s fabs in Shanghai and Nanjing, supporting investor confidence in the company’s capacity expansion plans through 2026.

On Monday, TSM shares reached an all-time intraday peak, climbing as much as 6% before settling slightly lower. The move marked the largest one-day percentage gain since April and underscored growing optimism that robust demand for AI-specific process nodes will fuel TSM’s capital expenditure cycle. Analysts estimate that AI-related wafer revenue could account for nearly 30% of TSM’s total sales by year-end, up from about 18% last year.

Goldman Sachs analysts issued a bullish note early this week, citing TSM’s leading technology roadmap and scale advantages. The firm highlighted that Taiwan Semiconductor’s 3-nanometer capacity utilization has consistently exceeded 90% since September, and forecast a 20% increase in total wafer starts for 2026. Goldman’s conviction rests on TSM’s ability to maintain pricing power in advanced nodes despite broader industry inventory correction.

Over the past 12 months, TSM shares have surged by approximately 45%, outpacing the broader semiconductor index. This performance reflects successful execution of a government-supported investment strategy in advanced packaging and extreme ultraviolet lithography tools, which has helped TSM capture more than 50% of the global foundry market. Investors will be watching second-quarter production yield trends as a barometer for the company’s capacity ramp and potential margin expansion.