This is not financial advice. Figures come from each company's own earnings release, dated as noted. Anything we calculated ourselves is marked as our math.
You can read the AI hardware boom through three kinds of chip company. TSMC makes the chips. Lam Research sells the machines that make them. Texas Instruments sells the analog and power chips found in nearly every board, including those in data centers. All three reported in the past week.
TSMC: the foundry (Q3 2026, reported Oct 15, 2026)
| Q3 2026 | |
|---|---|
| Revenue | US$46.72B (+41.2% YoY) / NT$1,494.24B (+50.9% YoY) |
| Gross margin | 66.4% |
| Operating margin | 58.7% |
| Net margin | 51.1% |
| EPS | NT$29.43 (US$4.60 per ADR) |
By node: 3nm was 33% of wafer revenue and 2nm was 8%. Advanced technologies (7nm and below) made up 79%.
Q4 2026 guidance: revenue of US$52.3–54.3B, gross margin of 65–67% and operating margin of 56.5–58.5%.
CFO Wendell Huang expects Q4 to be supported by "continued strong demand for our leading-edge process technologies, including the steep ramp-up of our 2-nanometer technology."
What to watch: 2nm is now a real share of revenue. The AI accelerators and high-end phone chips that buyers like Meta are paying for (see Meta's Q3 capex) are concentrated on these leading nodes.
Lam Research: the equipment maker (quarter ended Sep 27, 2026; reported Oct 21, 2026)
| GAAP | Non-GAAP | |
|---|---|---|
| Revenue | $8.22B | |
| Gross margin | 52.3% | 52.4% |
| Operating margin | 40.0% | 40.2% |
| Diluted EPS | $2.19 | $2.20 |
- China was 35% of revenue.
- Revenue rose 22% from the June quarter and about 54% from $5.32B a year earlier (our math).
- Guidance for the quarter ending Dec 27, 2026: revenue of $8.60B ± $0.4B, gross margin of 52.5% ± 1% and EPS of $2.33 ± $0.15 (GAAP and non-GAAP).
- Dividend: $0.33 per share.
CEO Tim Archer: "With AI driving higher semiconductor demand and greater device complexity, our focus on operational execution helped Lam deliver record revenue, profit, and earnings per share in the September quarter."
What to watch: Lam's systems revenue covers equipment for deposition, etch and cleaning. Chipmakers buy those tools when they add capacity, including memory makers ramping products like HBM. Lam's own risk factors list export controls among the things that could limit its sales, which makes the 35% China share worth watching.
Texas Instruments: the analog supplier (Q3 2026, reported Oct 21, 2026)
| Q3 2026 | Q3 2025 | Change | |
|---|---|---|---|
| Revenue | $6.06B | $4.74B | +28% |
| Operating profit | $2.87B | $1.66B | +73% |
| Net income | $2.43B | $1.36B | +78% |
| EPS | $2.62 | $1.48 | +77% |
- Revenue was up 11% from the previous quarter.
- Gross margin was about 64% ($3.89B gross profit on $6.06B revenue, our math).
- Trailing 12-month cash flow from operations was $9.9B. Free cash flow (a non-GAAP measure that includes CHIPS Act proceeds) was $8.4B.
- Q3 capital expenditures dropped to $463M, from $1.20B a year earlier.
- Q4 2026 guidance: revenue of $5.80–6.30B and EPS of $2.45–2.79.
CEO Haviv Ilan said revenue rose "with continued broad growth in industrial, automotive and data center."
What to watch: TI's risk factors name demand "particularly in the industrial and automotive markets" as a key factor. In this quarter's commentary, data center sits right alongside them.
The thread connecting them
- AI chip demand shows up first at TSMC, in leading-node revenue.
- Memory and logic capacity growth shows up at Lam, in equipment orders.
- Data center buildouts also pull in power and analog parts from suppliers like TI.
Meta, Microsoft, Alphabet and Amazon sit on the other side of these sales. Microsoft and Alphabet report on Oct 28, 2026, and Amazon on Oct 29 (call times are in our AI earnings calendar). For a builder's view of whether that spending adds up, read the AI capex math.
