---
title: "Prediction: This Will Be the Top-Performing Chip Stock Over the Next 10 Years (Hint: It's Not Nvidia)"
type: "News"
locale: "zh-HK"
url: "https://longbridge.com/zh-HK/news/229191816.md"
description: "Taiwan Semiconductor Manufacturing Company (TSMC) is predicted to be the top-performing chip stock over the next decade, despite Nvidia's prominence in the AI chip market. TSMC, a leader in foundry services, is crucial for major semiconductor companies and is expected to benefit from the growing demand for AI chips, projected to reach nearly $1 trillion by 2034. With a forward P/E ratio close to the S&P 500 average, TSMC presents a compelling investment opportunity for long-term investors, as it is well-positioned to thrive amidst rising competition in the chip industry."
datetime: "2025-02-21T13:00:22.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/229191816.md)
  - [en](https://longbridge.com/en/news/229191816.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/229191816.md)
---

> 支持的語言: [简体中文](https://longbridge.com/zh-CN/news/229191816.md) | [English](https://longbridge.com/en/news/229191816.md)


# Prediction: This Will Be the Top-Performing Chip Stock Over the Next 10 Years (Hint: It's Not Nvidia)

Over the last couple of years, semiconductor stocks have been some of the biggest beneficiaries of the market's newest megatrend, artificial intelligence (AI). In particular, suppliers of graphics processing units (GPUs) to data centers such as **Nvidia** and **Broadcom** have witnessed abnormally high gains relative to those seen across the **S&P 500** and **Nasdaq Composite**.

In the background, however, foundry specialist **Taiwan Semiconductor Manufacturing** (TSM -0.42%) -- known as TSMC -- has quietly emerged as a leader in the chip space in its own right. The best part? The stock is still dirt cheap. Here's why I think Taiwan Semi will turn out to be the top-performing chip stock over the next 10 years.

## Why TSMC looks primed to thrive

Data center GPUs are important pieces of hardware powering all sorts of exciting generative AI applications. In this sense, companies such as Nvidia, Broadcom, and **Advanced Micro Devices** should all be considered leaders when it comes to use cases such as training large language models (LLMs) or machine learning.

What you may not know, however, is that each of these companies relies heavily on Taiwan Semi to actually manufacture their chipware. TSMC specializes in foundry services, making chipsets for many different semiconductor providers that span use cases across computing, mobile devices, cloud infrastructure, and more.

While this makes the case for Taiwan Semi's current picture, it's the future prospects that have more even more intrigued. According to Precedence Research, the total addressable market (TAM) for AI chips is expected to reach nearly $1 trillion by 2034 -- roughly 10 times its current estimated size.

When you also consider that cloud hyperscalers such as **Amazon**, **Alphabet**, and **Microsoft** are all expected to spend north of $200 billion on chips just in 2025, I think it becomes increasingly feasible that the AI chip market will be expanding exponentially over the next several years.

TSM Revenue (Quarterly) data by YCharts.

The idea to understand here is that surging demand for chips from Nvidia and its peers bodes particularly well for Taiwan Semi, since the company is deeply embedded in the ecosystems of many leading semiconductor companies. Just to emphasize how important TSMC is for other chip companies, consider that it accounts for more than 60% of the chip manufacturing market -- absolutely trouncing competitors such as **Intel** and Samsung.

Image source: Getty Images.

## Why I think TSMC will generate higher returns than Nvidia

The chart below illustrates the share price returns between Nvidia and TSMC over the last couple of years. While Taiwan Semi stock has produced market-beating returns, it's not even close to what Nvidia investors have experienced.

TSM data by YCharts.

Even though the AI chip market is projected to continue growing, I think increased competition from AMD and custom silicon providers used by the hyperscalers will become a headwind for Nvidia in the next few years. In contrast, Taiwan Semi is in a position to actually benefit from rising competition in the chip space.

For this reason, I actually think TSMC's revenue and earnings acceleration will continue climbing. Nevertheless, TSMC is trading at a forward price-to-earnings (P/E) multiple of 22.6 -- quite close to the average forward P/E of the S&P 500, which sits at 20.9.

In my eyes, TSMC is sitting in a lucrative position to continue expanding its reach in the foundry industry. The growing market for chips, underscored by rising competition in the AI realm, has me bullish that an investment in Taiwan Semi will indeed produce superior returns to the S&P 500 in the long run.

However, I think TSMC stock is yet to have its "Nvidia moment," so to speak. For all these reasons, I think the stock is a no-brainer opportunity, trading for a bargain. Investors with a long-term time horizon may want to consider scooping up shares of TSMC right now and holding on tightly.

### 相關股票

- [Taiwan Semiconductor (TSM.US)](https://longbridge.com/zh-HK/quote/TSM.US.md)
- [NVIDIA (NVDA.US)](https://longbridge.com/zh-HK/quote/NVDA.US.md)

## 相關資訊與研究

- [TSMC Gets Nod to Deploy 3nm Process at Japan Fab](https://longbridge.com/zh-HK/news/281343240.md)
- [PFG Private Wealth Management LLC Takes $643,000 Position in Taiwan Semiconductor Manufacturing Company Ltd. $TSM](https://longbridge.com/zh-HK/news/281356678.md)
- [TSMC's unit TSMC Global acquires fixed-income securities for $19.8 mln](https://longbridge.com/zh-HK/news/281340806.md)
- [TSMC faces broad 3nm capacity shortage, fueling supply chain battle](https://longbridge.com/zh-HK/news/280962010.md)
- [Taiwan Semiconductor Manufacturing Company Ltd. $TSM Shares Acquired by Generate Investment Management Ltd](https://longbridge.com/zh-HK/news/280870298.md)