Google's move to develop custom AI chips aims to reduce its reliance on Nvidia's GPUs, which in turn is expected to generate new orders for Taiwan Semiconductor Manufacturing Company (TSMC). This strategic shift positions TSMC to benefit from both sides of the competitive landscape in AI architecture. In late May, key executives from Nvidia, AMD, and Intel visited Taiwan, coinciding with TSMC's stock reaching a new high. TSMC's management has raised its long-term gross margin floor to 56%, indicating strong confidence in its financial outlook. The upcoming Q2 earnings report on July 16 will be crucial, as analysts are keen to see if gross margins can stay within the guided range of 65.5–67.5% amid the ramp-up of new technologies. However, TSMC faces challenges, including a demanding earnings multiple of approximately 30x forward earnings and potential dilution impacts from new projects and currency fluctuations. Overall, TSMC is well-positioned to capitalize on the evolving chip market dynamics.