TSMC's Packaging Playbook and Apple's 1.4nm Bet Are Fueling a Rally — But How Much Is Already Priced In?

Shares of TSMC's Buenos Aires-listed stock (TSM.BA) surged 4.5% to $75,775 on June 18, extending a nine-session rally of nearly 9% from early-June lows, as a trio of catalysts converges: next-generation chip packaging, a blockbuster Apple deal, and a risk-on mood across global semiconductors. The question for investors is whether the excitement over future technologies is running ahead of the revenue timeline.

Apple's Biggest iPhone Chip Deal Deepens TSMC's Pricing Power. According to reports attributed to Mark Gurman, Apple could use its first processor manufactured with TSMC's 1.4nm process node — possibly called the A22 Pro — for high-end iPhones in 2028.

These smaller chips are much harder to produce and cost significantly more money, and reports indicate only the most expensive 2028 models will receive the top-tier hardware. That translates into fatter per-wafer revenue for TSMC. TSMC will make the majority of Apple's A22 Pro chips, but Apple is also considering having Intel make some of them — a reminder that even Apple's loyalty has limits.

A New Packaging Method Could Solve the AI Chip Bottleneck — Eventually. Chairman C.C. Wei disclosed at TSMC's June 4 shareholder meeting that the company has established a pilot line for CoPoS but emphasized it will take another two to three years to reach significant scale. CoPoS uses glass substrates to replace traditional materials, aiming to resolve warpage and capacity bottlenecks in large AI chip packaging.

TrendForce targets pilot production for 2027 and mass production for the second half of 2028. Investors are bidding up the stock now for revenue that won't materialize for two years.

The Numbers Already Look Strong — Which Raises the Bar. A record NT$572.5 billion ($18.2 billion) in Q1 net income — a 58% jump year over year — prompted TSMC to lift its full-year revenue outlook.

The revised guidance calls for growth exceeding 30% in dollar terms, a step up from the previous projection of roughly 30%.

Gross margin hit 66.2% in Q1 , and capex will come in toward the top of its $52–$56 billion guidance range. That spending signals management confidence but also compresses short-term free cash flow.

Intel Lurks as a Longer-Term Competitive Risk. Intel announced its first glass core substrate for advanced packaging, with mass production expected between 2026 and 2030 , and is developing its own 1.4nm node targeting 2028 production. If Intel executes, TSMC's premium pricing on cutting-edge nodes could face pressure precisely when these technologies scale.

The bottom line: TSMC's fundamentals are exceptional today, but the stock is increasingly pricing in a future where glass packaging, 1.4nm processes, and insatiable AI demand all arrive on schedule. Any stumble on that timeline could test the rally's foundation.