Taiwan Semiconductor Manufacturing Co. (TSMC), the world's leading contract chipmaker, is poised to announce a significant 54% increase in first-quarter profit, reaching approximately $10.74 billion. This surge is largely attributed to the escalating demand for advanced chips utilized in artificial intelligence applications, with major clients like Apple and Nvidia driving this growth.

Despite this financial success, TSMC faces potential challenges stemming from U.S. trade policies under President Donald Trump's administration. While President Trump has acknowledged TSMC's pivotal role in the semiconductor industry, he has also expressed concerns over Taiwan's dominance in this sector. Recently, he indicated that TSMC could face substantial taxes, potentially up to 100%, if it does not expand its manufacturing presence within the United States.

In response to these developments, TSMC has committed to significant investments in U.S. manufacturing. The company announced a $100 billion investment plan, including the construction of three new facilities in Arizona, supplementing an earlier $65 billion pledge. These initiatives aim to bolster TSMC's footprint in the U.S. and align with the administration's push for increased domestic semiconductor production.

However, the evolving U.S. trade policies introduce a layer of uncertainty for TSMC's future operations. The company's strategic decisions will need to navigate these complexities while maintaining its leadership in the global semiconductor market.