Huatai Securities: Maintains Buy rating on Taiwan Semiconductor with a target price of $370

Huatai Securities maintains a buy rating on Taiwan Semiconductor, with a target price of $370. The company's Q3 performance exceeded expectations, driven by strong AI demand that promotes the expansion of advanced process and packaging capacity. It has raised its revenue and capital expenditure guidance for 2025, with N2 mass production imminent and HPC growth expected in 2026. With its technological leadership and pricing power, it is expected to offset the short-term dilution of gross margins from overseas capacity expansion, ensuring long-term profitability. The company's Q3 performance exceeded expectations, driven by strong AI demand that promotes the expansion of advanced process and packaging capacity. It has raised its revenue and capital expenditure guidance for 2025, with N2 mass production imminent and HPC growth expected in 2026. With its technological leadership and pricing power, it is expected to offset the short-term dilution of gross margins from overseas capacity expansion, ensuring long-term profitability