The company's booming demand for AI applications solidified its position as a key player in the chipmaking industry.

TSMC, the world's largest contract chipmaker, has particularly benefited from the soaring demand for AI-capable chips.

Foreign investors have poured $4.8 billion into Taiwan's stock market, which is dominated mainly by TSMC.

TSMC's shares have surged nearly 80 per cent this year, significantly outperforming the Taiwan SE Weighted Index benchmark.

Yesterday, TSMC's Taipei-listed shares reached a record T$1,080, making it Asia's most valuable publicly listed company with a market value of T$28 trillion ($861 billion).

TSMC's American Depositary Receipts (ADRs) also hit a record high on the NYSE, briefly pushing the firm's market value to $1 trillion.

AI-focused chipmakers have seen substantial gains in market capitalisation throughout the year.

Nvidia briefly overtook Microsoft last month to become the world's most valuable company. TSMC's strong performance has positively impacted global chip stocks.

Grasshopper Asset Management portfolio manager Daniel Tan said: “Optimism continues to grow around AI-related demand and potential pricing powers, as TSMC's position as leading foundry supplier should elevate earnings in 2025."

"In an industry facing increasing tight supply, TSMC's value has to appreciate further in 2025 as customers bid to get sufficient capacity allocation," he said.