Industry sentiment broadly supports ongoing AI-related investment, though analysts warn of potential market corrections and questions about the durability of the AI boom.

Analysts and investors are divided on AI spending: some expect ongoing demand, while others foresee deceleration and a possible peak in AI-related outlays.

U.S.-China tech tensions loom over AI chip supply, with Beijing urging domestic firms to avoid foreign chips amid export controls that could affect American suppliers.

China is pushing domestic AI processors with state backing to reduce reliance on U.S. tech, shaping global chip dynamics.

Huang warned that U.S. export restrictions could spur China to accelerate rival AI chip development, potentially reshaping competition.

Challenges ahead include rising wafer costs for 2nm, overseas fab expenses, geopolitical frictions, talent shortages, and capacity constraints for smaller fabless firms, though long-term AI-driven growth and multiple-name leadership in advanced nodes remain bullish.

Analysts highlight AI processor demand from Nvidia and smartphone processor demand from Apple as key growth drivers for the sector.

Two factors tempering growth are strong but not as vertical AI demand as hyperscalers digest backlogs, and a broader mix with smartphones providing a stabilizing engine.

AI data-center expansion and ongoing demand from AI infrastructure builders offset by broad tech stock pressures and questions about valuation sustainability.

Volatility in tech equities and notable bearish bets on Nvidia reflect caution about high valuations, even as AI-driven capex remains a theme.

TSMC posted record October consolidated net revenue of about NT$367.5 billion (roughly US$11.87 billion), up 11% from September and 16.9% year over year, underscoring strong AI-driven semiconductor demand.

The company remains under tight capacity and supply-demand pressure as it continues to be the primary chipmaker for Nvidia, AMD, Qualcomm, and Apple, with Nvidia’s CEO pushing for additional supplies.