Taiwan Semiconductor Manufacturing Co. (TSMC) increased its market share in the global pure play wafer foundry industry to 67.6% in the first quarter of 2025.

This is up from 67.1% in the previous quarter, despite a 5% decline in sales to US$25.52 billion due to typical seasonal slowdowns.

TrendForce attributed TSMC’s market share growth to strong demand for AI applications and high-performance computing devices.

Additionally, rush orders from clients aiming to mitigate the impact of US trade tariffs helped offset the decline in smartphone-related sales.

China’s Semiconductor Manufacturing International Corp. ranked third with a 6% market share, followed by Taiwan’s United Microelectronics Corp. at 4.7%, and US-based GlobalFoundries at 4.2%.

🔗 Source: Focus Taiwan

🧠 Food for thought

1️⃣ TSMC’s expanding dominance signals a “winner-takes-most” market structure

TSMC’s market share increase to 67.6% demonstrates the semiconductor foundry business has evolved into a market where scale creates compounding advantages.

The gap between TSMC and its closest competitor Samsung (7.7% market share) has widened further, with Samsung’s sales falling 11.3% while TSMC’s declined only 5.0% despite seasonal effects 1.

This dominance is built on financial strength. TSMC maintains a 41.69% profit margin and 31.64% return on equity, providing substantial resources for continued R&D investment and capacity expansion 2.

The company’s $903.75 billion market capitalization reflects investor confidence in its sustainable competitive advantages and ability to maintain leadership in advanced manufacturing processes 3.

The foundry market’s consolidation trend continues with the top 10 manufacturers now accounting for 97% of global production, up from 96% in the previous quarter, creating significant barriers to entry for new competitors 1.

2️⃣ Geopolitical tensions reshape semiconductor supply chains beyond normal market forces

The article reveals how tariff concerns are directly influencing purchasing behavior, with TSMC benefiting from “rush orders placed by clients to avoid the impact resulting from the Trump administration’s tariff policies” 1.

Proposed semiconductor tariffs could reach up to 50%, potentially disrupting established supply chains and forcing manufacturers to reconsider sourcing strategies 4.