Breakfast News: TSMC Tops Sales Estimates
January 10, 2025
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Source: Image created by JesterAI.
1. Demand for AI Products and Services Remains Strong
Taiwan Semiconductor Manufacturing (TSM -2.98%) posted a 33% year-over-year net revenue increase for December, leading the way for 2024 to be the highest sales figure since the business went public back in 1994.
- Stock up 105% in the past year: The monthly revenue report is a taster of things to come, with Q4 earnings due 16 January. The combination of the December revenue and latest guidance already shows investors the high demand for artificial intelligence chips and services may well continue into 2025.
- "TSMC has benefited significantly from the strong demand for AI": Brady Wang from Counterpoint Research cited the most advanced chips Taiwan Semi makes are being utilized heavily, in part thanks to products like the GPUs from Nvidia (NVDA -1.87%).
2. Tesla Pivots From Cybertruck Production
Workers at the Tesla (TSLA -1.32%) Austin plant say the business is reassigning employees from Cybertruck production to focus on the Model Y instead.
- Outpacing the F-150 Lightning: The Cybertruck was the best-selling EV pickup in the U.S. in October and the third best selling in Q3. However, in absolute numbers this was only 16,692 units during the three months.
- Looking at the bigger picture: Slowing demand for EVs overall and increasing competition is a risk for the business overall this year. Yet with 1.79 million vehicle sales in 2024, the Cybertruck isn't relied on heavily when it comes to overall financial performance.
3. Energy Jumps With Cold Snap
The energy sector has started 2025 strongly, after lagging the market for the past two years. It's currently the best performing S&P 500 area so far in January, up 2.51%.
- "Broader sanctions against Russia and Iran (is) making this oil flow more difficult": Oil is set for a third straight weekly gain, with analysts at ING pointing a finger at the tightening of sanctions impacting supply.
- Tens of millions under U.S. cold alert: The winter swathe passing through areas of the U.S. and Europe is boosting fuel demand in the colder-than-usual start to the year. Natural gas stocks such as EQT (EQT 0.02%) and Antero Resources (AR 0.82%) have both traded higher this week.
4. Start-Ups Staying Private for Longer
With large-scale private fund raises ranging from SpaceX's $1.25 billion in November to December's $10 billion in Databricks, some big start-ups are choosing to stay private for longer.
- 7 largest US private companies are worth $695 billion: Tech and AI companies are able to access capital much easier and faster than before, reducing the need to go public to raise cash. It avoids the pressure of being listed, being less tied to short-term shareholder profitability demands.
- Bulky IPO candidates getting ready: Though this restricts access to many retail investors, it's unlikely these businesses will stay private forever. Private deals can come with clauses associated with eventually going public, as well as the good publicity that can come from being listed.
5. Foolish Fun
Which of these industries undergoing tech-fueled makeovers do you believe offers the biggest investment opportunity: Agriculture, automotive, construction, healthcare, or hospitality? Debate with friends and family, or become a member to hear what your fellow Fools are saying
