Taiwan Semiconductor Manufacturing Company Limited (TSMC) has recently seen a substantial drop in its stock price. The decline comes at a time when the company is facing a broader market correction influenced by various global dynamics and competitive challenges.
A significant part of this downturn can be attributed to geopolitical tensions, including a newly imposed 32% tariff on Taiwanese imports by the U.S., stirring concerns over trade relations and potential disruptions in the global semiconductor supply chain, as reported by Reuters. Furthermore, a significant 6.4 magnitude earthquake in Taiwan has disrupted both production and supply chains, adding to investors' worries about TSMC's operational stability, as noted by Morpher.
In addition to external pressures, TSMC is facing intensified competition within the semiconductor industry. This is highlighted by the emergence of the Chinese startup DeepSeek, which has introduced an affordable AI model challenging leaders like OpenAI's ChatGPT, according to Morpher. Such competition is coupled with a general market sell-off driven by fears of a trade war and increasing tariffs, impacting tech stocks universally, as covered by Nasdaq. These factors together illustrate the complexities impacting TSMC's current stock performance.