Third Point LLC Reduces Taiwan Semiconductor Holdings Amid Rising Geopolitical Strains

During the third quarter of 2025, Dan Loeb's Third Point LLC took notable action by decreasing its investment stake in Taiwan Semiconductor Manufacturing Company Limited (TSMC), a key player in the semiconductor industry. According to its latest 13F regulatory filing, representing holdings as of September 30, 2025, Third Point trimmed its position in TSMC by approximately 23%, bringing its total shares down from 1.43 million in the second quarter and 1.78 million in the first quarter to 1.10 million shares. This steady reduction in holdings over recent quarters suggests a cautious stance amid evolving political dynamics. The geopolitical climate surrounding semiconductor manufacturing has grown increasingly complex. The Trump administration’s recent pronouncements indicated a firm posture toward Chinese semiconductor advancements, although certain tariffs have been postponed until 2027. The U.S. Trade Representative articulated concerns that China’s efforts to dominate this strategic sector impose unreasonable burdens that restrict U.S. trade, justifying governmental intervention. Against this backdrop of heightened tensions, Taiwan Semiconductor has proceeded with strategic pricing decisions. In November 2025, the company reportedly increased prices for its advanced chip products, including those critical to cutting-edge applications. This decision was made despite military activities near Taiwan by China, signaling the company’s confidence in maintaining market positioning while navigating geopolitical challenges. Financially, Taiwan Semiconductor exhibited strong operational results in the third quarter of 2025. The company posted net sales totaling $33.1 billion USD (equivalent to approximately 989.9 billion New Taiwanese dollars), marking a year-over-year increase of 30.3%, surpassing analysts’ forecast of $31.5 billion. Sequentially, revenues rose 6.0% compared to the previous quarter. Looking forward, the company anticipates fourth-quarter revenue in the range of $32.20 billion to $33.40 billion, exceeding the consensus estimate of $31.97 billion. It projects a gross margin between 59% and 61%, along with operating profit margins from 49% to 51%. In addition to revenue growth, Taiwan Semiconductor secured government subsidies amounting to 4.77 billion New Taiwanese dollars in Q3 2025, contributing to cumulative support of 71.9 billion New Taiwanese dollars in the first nine months of the year. Correspondingly, the company raised its quarterly cash dividend by 20%, from 5 New Taiwanese dollars per share in the previous quarter to 6 New Taiwanese dollars, around $0.19, reflecting confidence in its financial stability and capital returns. Monthly sales updates extended the positive momentum. October 2025 revenues stood at approximately 367.47 billion New Taiwanese dollars, growing 16.9% year-over-year and 11.0% sequentially. November revenues reached roughly 343.61 billion New Taiwanese dollars, increasing year-over-year by 24.5% but declining 6.5% month-over-month, suggesting some volatility amidst ongoing market developments. Commentary from industry experts underscores the strategic importance of Taiwan Semiconductor amid global uncertainties. Dan Nystedt of TriOrient Investments highlighted the company’s pivotal position, supported by the concept of a ‘‘silicon shield’’ offering Taiwan a measure of security. While acknowledging inherent risks such as a potential reversal in artificial intelligence demand, Nystedt noted that the company collaborates closely with customers to accurately assess demand levels and avoid capacity overextensions. Taiwan Semiconductor’s commitment to advancing artificial intelligence technologies remains evident. In October 2025, Nvidia Corporation introduced its first U.S.-made Blackwell wafer—a critical component for AI chip production—at TSMC’s fabrication facility in Phoenix. The company’s Japanese subsidiary, Japan Advanced Semiconductor Manufacturing (JASM), entered into an agreement with the Kikuyō Town government in Kumamoto Prefecture to establish a second wafer fabrication plant with a capital investment of $13.9 billion. Price adjustments on advanced chip manufacturing processes, particularly below the 5-nanometer scale, were implemented to offset rising capital expenditure associated with the company’s 2-nanometer technology development. TSMC has reaffirmed its focus on expanding its U.S. manufacturing footprint, a strategic move to support growing demand for AI-driven semiconductors. By December 2025, the company commenced volume production of its 2-nanometer chips, signaling progress in cutting-edge technology. In a notable recent development, TSMC surpassed its previous 52-week stock price high after obtaining a one-year export license from the United States, permitting the continued importation of U.S. chipmaking equipment for its facilities in China, which alleviates some operational pressures in a sensitive geopolitical environment. When compared with market peers and relevant ETFs, TSMC's stock performance has been robust over the last year. Shares appreciated roughly 52.81%, well outpacing the SP Funds S&P World ex-US ETF (SPWO), which increased by 26.42%, and significantly outperforming the YieldMax TSM Option Income Strategy ETF (TSMY), which declined by 18.44%. TSMC also exceeded the growth rates of influential semiconductor companies NVIDIA and Broadcom Inc., which gained 35.40% and 51.58%, respectively. This comprehensive picture reveals Taiwan Semiconductor’s resilience and strategic agility amid a complex matrix of market opportunities, geopolitical challenges, and technological leadership, factors that continue to shape investor behavior including that of major shareholders such as Third Point LLC.