The world’s largest contract chipmaker expects that increasing use of AI-powered features in smartphones will fuel demand for the next generation of devices.

Taiwan Semiconductor Manufacturing Company (TSMC) reported a record $26.3 billion in net sales in the past quarter, up by more than a third year-on-year, and generating profit of $11.4 billion.

The company, founded in 1987, is now the main semiconductor supplier to Apple, which accounted for a quarter of its revenue, and the AI technology company Nvidia, which made up 11 per cent.

Its high-performance computing division, which encompasses artificial intelligence and 5G applications, contributed 53 per cent of revenue, driven by demand for the advanced chips in Apple’s latest iPhone 16.

Demand for consumer electronics was expected to level slightly,