W.044SK hynix and Micron now keep about 80 cents of each sales dollar as operating profit, TSMC 59. TSMC says it is a logic foundry after a report it planned DRAM for Nvidia
The Information reported on November 6 that TSMC had begun drawing up plans to make stacked DRAM at Nvidia’s request; on November 7 TSMC said it focuses on being a dedicated logic foundry. The memory crunch explains the interest: SK hynix and Micron earned operating margins of about 80% in their latest quarters, against TSMC’s 58.7%. Micron guided to $61.5B of sales this quarter, more than TSMC’s $53.3B midpoint, and Nvidia’s supply commitments, mainly memory and manufacturing facilities, rose from $119B to $279B in a quarter.
The report and the reply
TSMC said it would stay a logic foundry. The Information reported on Friday, November 6, citing two people with direct knowledge, that TSMC had recently begun drawing up plans to make vertically stacked, or 3D, DRAM at the request of Nvidia, its largest customer. Reuters, relaying the report, said the work is led by Hsu Kuo-chin, the vice president who oversees advanced packaging, and that TSMC is weighing new fabs or buying and retooling an existing site; no amount or date was reported. On November 7 a TSMC spokesperson told Tom’s Hardware that the company focuses on its core business, “dedicated IC foundry”, and on serving the logic chip industry. The statement did not mention the report; Tom’s Hardware read it as essentially a denial, while noting it does not rule the work out. Nvidia did not immediately respond to Reuters.
The shares moved on it. TSMC’s American shares rose 6.26% on November 6, after falling 10.78% to $353.10 the day before; they still lost 7.61% in the week and 20.54% in a month. Taiwan’s market had closed before the report. Tom’s Hardware wrote that 3D DRAM is years from market viability and could not ease the shortage for at least five years.
Memory makers’ margins passed TSMC’s
Operating income as a share of revenue, %, in the latest reported quarter (orange; TSMC in blue-grey) and a year earlier (grey). SK hynix, Samsung and TSMC: July–September 2026. Micron: fiscal fourth quarter to September 3, 2026, GAAP. Samsung is its whole chip (DS) division, which includes foundry and System LSI as well as memory; SK hynix and Samsung margins are our arithmetic from reported won figures.
Why a logic foundry would look
Memory now earns more on each dollar than the world’s most profitable chip foundry. SK hynix made an operating profit of KRW 83.3T on KRW 104.6T of third-quarter sales, a margin of 79.7%, up from 46.6% a year before. Micron’s GAAP operating margin in its quarter to September 3 was 80.7%, up from 32.3%, and its gross margin 86.8%, up 42.1 points. Samsung’s chip division, which includes its foundry, earned 72.4%, against 21.1%. TSMC’s operating margin was 58.7%, up 8.1 points, 22 points below Micron’s.
Micron is now selling more a quarter than TSMC. Micron reported $54.23B for its quarter to September 3, 379% more than a year earlier, and TSMC $46.72B for the quarter to September 30; Micron’s figure is 16% higher. Micron guided its quarter to early December at $61.5B, give or take $1.5B; TSMC guided October–December at $52.3–54.3B. The quarters overlap but are not the same.
Micron’s quarterly sales are above TSMC’s
Revenue, $ billions. Latest quarter: Micron’s fiscal fourth quarter, to September 3, 2026; TSMC’s third quarter, to September 30. Guidance for the next quarter, outlined across the range: Micron’s fiscal first quarter of 2027 ($61.5B ± $1.5B) and TSMC’s fourth quarter ($52.3–54.3B). The periods differ by about a month.
Nvidia’s side
Nvidia’s commitments to suppliers more than doubled in a quarter. Its quarterly filing for the three months to July 26 put supply commitments at $279B, up from $119B at April 26, an increase of $160B, and said they are primarily for memory and manufacturing facilities; it does not give memory alone. On the August 26 call, its chief financial officer said the rise in prices had exceeded the company’s prior expectations. Nvidia reports its next quarter on November 17.
The memory makers are spending more. Micron spent $27.37B, net, in the fiscal year to September 3; its chief financial officer guided to about $25B in the first half of fiscal 2027, rising in the second, which Herald Corp reported puts the year on track to exceed $50B. It bought a fab in Tongluo, Taiwan, from Powerchip for $1.8B in March, with meaningful DRAM output expected from the second half of 2027. TSMC’s 2026 budget is $60–64B. SK hynix said its investment will rise significantly in 2027; Samsung plans about KRW 84.4T of capital spending this year, KRW 76.8T of it on chips.
Nvidia’s supply commitments rose $160B in a quarter
Nvidia’s supply commitments, $ billions, at the end of its first and second fiscal quarters of 2027, as stated in its 10-Q. The filing says they are primarily memory and manufacturing facilities and gives no split.
Micron’s capital spending is heading toward TSMC’s
Capital spending, $ billions: TSMC’s calendar 2026 budget ($60–64B, the dashed part is the range); Micron’s net capital spending in its fiscal year to September 3, 2026; and the more than $50B Herald Corp reported fiscal 2027 is on track for, after the chief financial officer guided about $25B for its first half. Samsung and SK hynix give no dollar figure for memory alone.
Operating margins, as computed
| Company | Period | Year earlier | Latest | Change, pts |
|---|---|---|---|---|
| SK hynix | Q3 2026 | 46.6% | 79.7% | 33.1 |
| Micron | FQ4 2026 | 32.3% | 80.7% | 48.4 |
| Samsung chips | Q3 2026 | 21.1% | 72.4% | 51.3 |
| TSMC | Q3 2026 | 50.6% | 58.7% | 8.1 |
What this changes on 06.ai
- Memory balance pack: TSMC’s November 7 statement keeps it out of DRAM for now; even on the reported plan, Tom’s Hardware puts 3D DRAM at least five years from easing supply. New supply through 2027 still comes from the three memory makers, Micron’s Tongluo fab included.
- Memory prices pack: Micron’s September 30 guidance put its GAAP gross margin at about 86% for the quarter to early December, close to the 86.8% just reported: the pack’s price path can be checked against that when Micron reports in December.
- Watch Nvidia’s 10-Q after November 17 for the next supply-commitment figure, and TSMC’s October sales on November 10.
Sources and method
| Item | Figure | Source |
|---|---|---|
| Report | TSMC began drawing up plans to make vertically stacked 3D DRAM at Nvidia’s request, per two people with direct knowledge; led by Hsu Kuo-chin; weighing new fabs or buying and retooling a site | Reuters, on The Information, via Investing.com, Nov 6 |
| TSMC | TSMC: it focuses on its core business, dedicated IC foundry, and aims to serve the logic industry; 3D DRAM at least five years from easing shortages (Tom’s Hardware analysis) | Tom’s Hardware, Nov 7 |
| Shares | TSMC ADR −10.78% to $353.1 on Nov 5; +6.26% on Nov 6; -7.61% in the week, -20.54% in a month; October sales due Nov 10 | 24/7 Wall St., via Yahoo Finance, Nov 7 |
| TSMC | Q3 2026 revenue $46.72B; gross margin 66.4%, operating margin 58.7%; Q3 2025 gross profit 588,543 and operating income 500,685 on revenue 989,918 (NT$M); Q4 guidance $52.3–54.3B | TSMC 6-K, Oct 15 |
| TSMC | 2026 capital budget held at $60–64B | Focus Taiwan, Oct 15 |
| SK hynix | Q3 2026 revenue KRW 104.6155T, operating profit KRW 83.3338T (80%); Q3 2025 KRW 24.4489T and KRW 11.3834T | SK hynix, Oct 28 |
| Samsung | Q3 2026 DS division revenue KRW 147.1T, operating profit KRW 106.5T; 2026 capex about KRW 84.4T, KRW 76.8T in DS | Samsung Electronics, Oct 29 |
| Samsung | Q3 2025 DS division revenue KRW 33.1T, operating profit KRW 7T | Samsung Electronics, Oct 30, 2025 |
| Micron | Fiscal Q4 2026 revenue $54.23B (year earlier $11.32B); GAAP gross margin 86.8% (44.7%), operating margin 80.7% (32.3%); fiscal Q1 2027 guidance $61.5B ± $1.5B; fiscal 2026 net capex $27.37B | Micron 8-K, Sep 30 |
| Micron | CFO: about $25B of capex in the first half of fiscal 2027, rising in the second; the paper reports the year on track to exceed $50B | Herald Corp, Oct 1 |
| Micron | $1.8B purchase of PSMC’s Tongluo fab, completed March 16; meaningful DRAM output from the second half of 2027 | Manufacturing Dive |
| Nvidia | Supply commitments rose from $119B to $279B at July 26, 2026, primarily memory and manufacturing facilities | Nvidia 10-Q, Aug 26 (text via OpenCapital) |
| Nvidia | CFO: the price increase has exceeded prior expectations | Nvidia Q2 FY2027 call, Aug 26 (transcript via Webull) |
| Nvidia | Third-quarter results on November 17 | Nvidia, Oct 28 |
Operating margins are compared because SK hynix and Samsung do not report gross margin. SK hynix: 83.3338 ÷ 104.6155 = 79.7%; a year earlier 11.3834 ÷ 24.4489 = 46.6%. Samsung DS: 106.5 ÷ 147.1 = 72.4%; 7 ÷ 33.1 = 21.1%. TSMC Q3 2025: 500,685 ÷ 989,918 = 50.6%; gross 588,543 ÷ 989,918 = 59.5%. Gaps: 80.7 − 58.7 = 22.0 points; gross-margin change Micron 86.8 − 44.7 = 42.1, TSMC 66.4 − 59.5 = 6.9. Sales: 54.23 ÷ 46.72 − 1 = 16.1%; TSMC midpoint (52.3 + 54.3) ÷ 2 = 53.3; 61.5 ÷ 53.3 − 1 = 15.4%; Micron year on year 54.23 ÷ 11.32 − 1 = 379.1%. Nvidia: 279 − 119 = 160; 279 ÷ 119 = 2.34. TSMC ADR close, Nov 6: 353.1 × 1.0626 ≈ $375.20 (our arithmetic; not used in the text). The Information’s report was read through Reuters’ and Yahoo’s summaries; Reuters says TSMC is weighing new fabs or buying and retooling an existing site. Fiscal periods differ: Micron’s quarter ended September 3, Nvidia’s second quarter July 26.
Wire reports are written within hours of the news, on a six-hour schedule. Each lists its sources and shows the arithmetic behind its figures. Not investment advice.