Chip stocks surged on Thursday as Taiwan Semiconductor Manufacturing Company’s (TSMC) strong earnings report bolstered confidence in the semiconductor industry’s growth trajectory. The rally was led by major players like Nvidia, Advanced Micro Devices (AMD), and Broadcom, along with key equipment and materials suppliers. Nvidia, the world’s most valuable company and dominant force in AI-driven processors, saw its shares rise nearly 3% during early afternoon trading. AMD followed with a 6% gain, while Broadcom, known for its custom AI chips, added about 2%. The momentum extended to TSMC, the world’s largest contract chipmaker, whose fourth-quarter profit jumped 35% year-over-year, surpassing analyst expectations. TSMC also signaled optimism for the future by announcing plans to increase capital spending in 2026, a clear indicator of sustained demand for advanced chip manufacturing. TSMC’s finance chief, Wendell Huang, emphasized that demand for its cutting-edge process technologies remains robust, stating, “We expect our business to be supported by continued strong demand for our leading edge process technologies.” The positive outlook sent TSMC’s shares up more than 6%. The strong results came ahead of the upcoming U.S. tech earnings season, which begins next week with Intel, a struggling chipmaker facing challenges in its manufacturing and product roadmap. Apple, Tesla, Meta, and Microsoft are set to report their results the following week, drawing significant market attention. The broader semiconductor sector benefited from the news. The VanEck Semiconductor ETF, which includes Nvidia, TSMC, and Broadcom as top holdings, rose 3.5%. Micron, the fourth-largest holding in the fund, gained over 3%. Equipment makers also saw strong gains: Lam Research climbed 6.5%, and Analog Devices rose nearly 2%. The rally underscores growing investor confidence that the AI-driven demand for advanced chips is not a short-term trend but a sustained force shaping the future of technology.