By Ben Blanchard and Faith Hung TAIPEI (Reuters) - Taiwan Semiconductor Manufacturing Co (TSMC), the leading manufacturer of advanced chips for artificial intelligence, is projected to announce a 40% increase in its third-quarter profit on Thursday, driven by rising demand. As the world’s largest contract chipmaker, with clients like Apple and Nvidia, TSMC has capitalized on the AI boom. According to an LSEG SmartEstimate based on insights from 22 analysts, TSMC is anticipated to report a net profit of T$298. 2 billion ($9. 27 billion) for the quarter ending September 30. SmartEstimates prioritize the predictions of analysts with proven accuracy. This projection marks a significant rise from TSMC's 2023 third-quarter net profit of T$211 billion. Last week, TSMC shared that its revenue for the third quarter, reported in Taiwan dollars, had significantly exceeded market forecasts.

The company will provide its revenue outlook in U. S. dollars during its earnings conference. "Most of TSMC's key clients, including Apple, Nvidia, AMD, Qualcomm, and Mediatek, are unveiling new products that heavily depend on TSMC's advanced process technologies, " noted Li Fang-kuo, chairman of President Capital Management. "TSMC's Q3 earnings are expected to far surpass expectations, " Li added. In its quarterly earnings call scheduled for 0600 GMT on Thursday, TSMC will offer updates on its outlook for the ongoing quarter and the entire year, including plans for capital expenditure amid its production expansion efforts. The company is investing billions in constructing new factories abroad, notably $65 billion for three plants in Arizona, USA, although it maintains that the majority of its manufacturing will continue in Taiwan. During its previous earnings call in July, TSMC raised its full-year revenue forecast and revised its capital expenditure plans for this year to a range between $30 billion and $32 billion, up from an earlier estimate of $28 billion to $32 billion. The surge in AI has significantly boosted the share price of TSMC, Asia's most valuable company, with its stock listed in Taipei soaring 77% this year, in contrast to a 28% rise in the broader market. Headquartered in Hsinchu, TSMC is often referred to as the "sacred mountain protecting the country" due to its vital role in Taiwan's export-driven economy and faces minimal competition. Once a dominant player in the semiconductor sphere, Intel, which has been around for five decades, is currently navigating its worst phase as losses accumulate in its contract manufacturing division, which it aims to expand to rival TSMC. ($1 = 32. 1570 Taiwan dollars) (Reporting by Ben Blanchard and Faith Hung; Editing by Christopher Cushing)