Profits surge at Apple and Nvidia supplier TSMC

This BBC podcast is supported by ads outside the UK. Aser does it. So, we'll now go to your podcast. Start your free trial period on shopfy.com. The company behind many of the world's most advanced computer chips has reported another record quarter. Taiwan Semiconductor Manufacturing Company, or TSMC, which makes chips for products including Apple's iPhones and NVIDIA's AI processors, says profits jumped by more than 77%. While the world's biggest contract chipmaker says demand remains extremely strong and it's investing billions more to expand production. Joanne Chow is research manager at Trendforce in Taipei. Everyone knows that AI is quite strong. What TSMC said about AI is even stronger than our original expectation. And they said the AI demand is stronger and stronger even through 2030. And I'm a bit surprised that they can even do the upward revision on their year-over-year performance in this year to 40% year-over-year growth, and also revising up their CAPEX plan to 60 to 64 billion US dollars CAPEX is capital expenditure that they spending monies on expanding their capacity building up new fabs maybe in the R development I think that a positive part The biggest US tech companies are expected to spend more than $700 billion on AI this year. How much of that is flowing through companies like TSMC? We all know that PSNC will be a lot benefit from the investment, but it's hard to make that as a number. Is there a risk really that the AI market could be becoming too dependent on one company to make the world's most advanced chips? I think all of the customers already, they don't want to put all of the orders in just one company. So of course, Samsung and Intel are also trying to make some advanced chips. And I think Intel already, they're making the CPU for also server and also AI server. But we know TSMC is the biggest one and they make most of the chips. Despite Despite the tariffs, trade tensions and geopolitical uncertainty, demand for AI chips remains incredibly strong. So has AI become largely immune to those headwinds? The geopolitical risk is still happening. I think that's also one of the reasons why TSMC need to enlarge their investment amounts in Arizona. And also we still see supply chains moving like back to China or out of China. because of the AI demand is too strong. Joanne Chow from Trendforce there. While the latest figures from the United States suggest consumers are still spending despite ongoing economic uncertainty and the impact of tariffs, retail sales rose in June held by strong online shopping while fewer Americans than expected filed for unemployment benefits pointing to a resilient labour market. I spoke to Samira Hussain, our business correspondent in New York. Even though these retail sales are coming in lower compared to last month, we're still seeing that consumers are spending. And if you take out things like petrol, well, we saw that retail sales actually went up by 0.7 percent in that one month period. And we saw that people were purchasing some bigger ticket items like new vehicles and then also Amazon Prime Day. That's always a big moneymaker. And it's been a very busy period in the United States. We're talking, you know, the US hosting the FIFA World Cup. It recently celebrated its 250th anniversary. So how much of all of these are being factored in the numbers? It certainly is having an impact. But some cities of course are going to be feeling more of the impact than others So with regards to the World Cup if you not one of the host cities you not seeing a lot of that revenue coming in Samira Hussain in New York Well let talk about NVIDIA now because it has unveiled a new AI model for robots as it expands its presence in Japan. Let's bring in Nicholas Hyatt, who is lead alternatives analyst at Hargreaves Lansdowne. Nicholas, is physical AI and robotics the next big opportunity for the company? So far, AI models have all been about making office and research work and workers more efficient. Physical AI would move that revolution out of labs and offices and into factories and the service sector. I mean, that could be easier said than done, but it would be a massive opportunity for companies like NVIDIA. Actually, I think the size of the opportunity isn't the real issue. The big question is how society would adjust to a world where there are just fewer jobs for humans to do. and who would buy all these AI-generated products and services if humans are out of work. Well, we'll wait to see how that goes then. Nicholas Hyatt from Hargreaves, Lansdowne. Thank you. The UK government has taken British steel into full public ownership from Chinese company Jingye to protect the future of steel production, it said. The country's last factory that makes steel from scratch faced closure last year after Genghis said the plant in northern England was no longer financially viable. It employs nearly 3,000 people. Now, the Dutch port of Rotterdam is Europe's largest freight hub and is home to some of the continent's biggest oil terminals. But now it's pitching itself as a green port with a promise to slouch energy emissions. Our correspondent Anna Holligan has more. The port of Rotterdam has a problem. Our current emissions are 29 million tons of CR2. The equivalent of? 60,000 return flights from Amsterdam to Los Angeles. We're driving through the vast industrial site with Mark Van Dyck, head of External Relations, the Port of Rotterdam Authority. It's not very good. Sometimes we are just waiting till there is one magic solution that suddenly solves all the climate emissions. Well, I can promise you that won't be there. Sheltering from the wind. Director of the environmental group Advocates for the Future, Michael van Vissen. We are not asking to shut down the port immediately. This is a really big industry. We are still, as a society, very dependent on it. He's launched a lawsuit to compel the port to reach its own climate targets faster. What the port is doing right now they are building up enough things while not having a plan to build off the existing fossil industry that what we know in 2050 should not be here anymore Among other things, the POR is developing a hydrogen hub, investing in on- and offshore power, and there's also an effort to mitigate CO2 emissions with carbon capture and storage. So do you think those innovations that they're working on will have any real impact? To be honest, no. Oskar van Veen is the port's director of innovation. Do you see innovations being capable of getting to the point where the people who are working in the fossil fuel industry now will have been redeployed into something that's cleaner and greener? Absolutely, absolutely. There will still be factories, only it will be on hydrogen. The vision will be the same, but the noise will be different, I think. But many of the biggest emitters in this port answer to headquarters in the US or China. If the rules in Rotterdam become too tight, they can simply move. And a contrast in legislation sharpens Rotterdam's concern and the activists resolve. If we can get a court to say you really need to do something against climate change, that can set a precedent not only for the Netherlands, but for the world as a whole. The port insists they are heading in the same direction. The disagreement is over how fast? Anna Hulligan in the port of Rotterdam there. And that's it from World Business Express. Please subscribe to get the latest. You don't want to miss a thing. All you need to do is search for World Business Express. I'm Bissi Adebayo. Thanks for listening. And don't forget, you can also catch World Business Report with my colleague Gideon Long much later. Is the American Dream still possible? I'm Asma Khalid, one of the hosts of the Global Story podcast from the BBC. One of the most successful exports the United States has ever sold the world is the American Dream, that tantalizing promise of a better, freer, richer life. But is it still attainable? I feel like the American Dream is alive, but not well. For more, listen to The Global Story on BBC.com or wherever you get your podcasts. .