TSMC and ASML both reported strong demand this week, but they are different ways to participate in the semiconductor investment cycle. TSMC manufactures chips for customers. ASML supplies lithography equipment and related service and upgrades. One company's expansion helps create demand for the other's tools; that connection does not make their revenues, spending or stock valuations interchangeable.
This weekend comparison uses their newly reported Q3 results and completed October 16 US regular-session closes. TSMC's quarter ended September 30 under TIFRS; ASML's ended September 27 under US GAAP. The dollar prices below belong to their US-listed securities, not to the local-currency financial statements.
Strong growth on two different currency bases
TSMC reported US$46.72 billion of revenue, up 41.20% year over year in US dollars. Its New Taiwan dollar revenue grew 50.90%. Those are two currency translations of the business, not two competing growth figures. Reported gross margin was 66.40% and operating margin 58.70%. Both margins were lower than Q2's 67.70% and 60.30%, even as sales rose. TSMC Q3 results.
ASML reported EUR11.662 billion of sales, versus EUR7.516 billion a year earlier, a calculated 55.16% increase in euros. Gross margin was 57.50%, up from 54.00% in Q2, while operating margin rose to 44.40% from 37.10%. Installed-base service and upgrades contributed approximately EUR3.29 billion of the quarter's sales. ASML Q3 release.
The gross-margin gap is descriptive. A foundry and an equipment supplier have different cost structures and capital needs; the higher percentage is not an automatic quality or value winner. Likewise, the native-currency sales-growth figures are not an FX-neutral head-to-head score. TSM's diluted US-dollar EPS is per ADR representing five ordinary shares, whereas ASML's Nasdaq security is a New York registered ordinary share. Their share prices and per-share earnings cannot be compared as if the units matched.
Cash needs a working-capital check
TSMC's Q3 statements show NT$919.776 billion of operating cash flow and NT$443.206 billion of cash PP&E purchases. The difference is NT$476.570 billion, an analytical cash remainder after those specified purchases, not a claim that every investing or financing obligation has been deducted.
ASML reported EUR11.798 billion of operating cash flow. That included approximately EUR7.009 billion of cash benefit from changes in assets and liabilities. Subtracting EUR413.3 million of cash PP&E purchases and EUR33.9 million of intangible purchases leaves about EUR11.350 billion on that specified boundary. Working-capital movements are a major reason not to treat one quarter's cash result as a recurring run rate. These local-currency amounts are not presented as a comparable dollar ranking. ASML financial statements, TSMC financial statements.
Guidance is a delivery test, not revenue already earned
TSMC's Q4 revenue guidance is US$52.30-54.30 billion, with 65.00-67.00% gross margin, using its stated NT$31.8-per-US-dollar assumption. Its US$60-64 billion 2026 capital budget was reiterated, not newly raised at this Q3 call. Higher capacity spending still has to earn a return; leading-edge ramps and overseas manufacturing can weigh on margins while demand grows.
ASML guided Q4 sales to EUR14.20-15.20 billion and gross margin to approximately 57.00%. Management said its currently planned 2027 and 2028 supply would not fully meet customers' demand and was investigating further capacity. That is management's outlook, not a guarantee of future recognized sales. Customer interest in orders extending into later years is not a disclosed numeric bookings result, and this release did not provide numeric 2027 sales guidance.
TSM: strong results, short-term chart repair still required
TSM's final October 16 regular close was $412.61, down 2.28% for the session and 8.98% from the October 9 close. It finished below the 20-day SMA of $452.47 and 50-day SMA of $434.36, while remaining above the 200-day SMA of $395.05.
The October 15 intraday low of $407.13 is a nearer lower reference. The surviving October 15 downward daily gap at $423.66-$428.06 lies overhead, before the 50-day average. Recovering that gap area and then sustaining the relevant level on a daily closing basis would improve the chart. A failed reclaim or a break below the dated low would be different evidence; neither outcome is assumed here.
ASML: above the long average, below the shorter ones
ASML's final October 16 US regular close was $1,641.52, down 0.96% for the session and 7.80% from the October 9 close. Its 20-day SMA was $1,761.48, 50-day $1,739.63 and 200-day $1,577.22. Like TSM, it was below the shorter averages and above the longer one; that is short-term damage within a different, broader trend context.
The October 15 intraday low of $1,594.03 sits above the 200-day average. Overhead, the surviving October 13 downward daily gap at $1,734.50-$1,750.02 overlaps the 50-day average. These are dated areas to test, not promised targets. For either company, a daily retest requires the test and a daily close back above the level; an intraday visit alone does not meet that definition.
Verdict: choose the question before the winner
TSMC's test is whether profitable leading-edge demand keeps supporting a capital-intensive manufacturing expansion. ASML's test is whether customer investment plans convert into delivered and accepted equipment and continuing service revenue. Both remain exposed to execution, geopolitical and export-control risks, and the pace of the spending cycle.
The latest reports support demand; Friday's charts independently describe the market's price response. Neither a larger gross margin nor faster native-currency sales growth resolves which stock offers the better future return. This comparison therefore separates business performance, cash timing and chart confirmation rather than forcing a single numerical winner from incompatible metrics.
Explore TSM Daily Levels, ASML Daily Levels and other comparisons.
This is market research only, not a recommendation to buy or sell.