Warren Buffett sold Taiwan Semiconductor, an AI chip company that manufactures the backbone of the entire AI revolution, and he did it in under two quarters. The decision, which saw Berkshire Hathaway exit a $4.1 billion position faster than almost anyone expected, had nothing to do with the business itself. It came down entirely to geopolitical investment risk. And right now, that same risk sits unresolved for anyone evaluating Taiwan Semiconductor stock today.
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Why Warren Buffett Left Taiwan Semiconductor Despite AI Dominance
A $4.1 Billion Position Gone in Two Quarters
Berkshire Hathaway disclosed the initial TSM stake in November 2022. At the time of writing that filing, roughly $4.1 billion worth of shares had been accumulated during Q3 of that year. It looked like a fairly classic Buffett move. Taiwan Semiconductor was already a dominant AI chip company with strong margins, enormous barriers to entry, and a level of control over advanced chip manufacturing that no competitor could realistically match.
Then by Q4, Berkshire had sold off 86% of the position. The remainder cleared by May 2023. For a man whose preferred holding period is forever, the full exit in under two quarters was one of the more surprising moves in recent investing history. Buffett sold the AI chip company while openly acknowledging it remained the best in the world.
What Buffett Actually Said About Taiwan Semiconductor
Buffett never questioned what Taiwan Semiconductor does or how well it runs. At Berkshire’s 2023 annual shareholder meeting, he had this to say:
“Taiwan Semi is one of the best-managed companies and important companies in the world.”
His problem was the geography. Asked directly about the sale, Buffett stated:
“I don’t like its location.”
That was a reference to escalating tensions between the US and China and the possibility of a conflict involving Taiwan. Geopolitical investment risk, not profit concerns, drove the exit from this dominant AI chip company. He also acknowledged, fairly bluntly, that nobody else in the semiconductor industry operated at Taiwan Semiconductor’s level.
Why the Decision Still Matters for Taiwan Semiconductor Stock
Atreides Management CIO Gavin Baker, speaking at the 2026 Sohn Conference, framed the scale of Taiwan Semiconductor’s grip on the AI supply chain in striking terms:
“If Taiwan Semi did what Jensen wanted, Nvidia could sell $2 trillion of GPUs in 2026 or 2027.”
That is the foundry’s position in a sentence. Warren Buffett TSMC investors held a stake in the single chokepoint controlling how much AI computing power reaches the market. Taiwan Semiconductor manufactures roughly 90% of the world’s most advanced semiconductors and now carries a valuation of more than $2 trillion. Every major AI player, including Nvidia, AMD, Broadcom, Amazon, Microsoft, and Alphabet, depends on it to turn chip designs into physical products.
Buffett sold the AI chip company he called the best in the world. That tension is what makes the decision worth revisiting. The business case for Taiwan Semiconductor stock has only grown stronger. The geopolitical investment risk he identified in 2022 has not gone away. Anyone looking at Warren Buffett TSMC and the lessons from that exit faces exactly the same tradeoff today.
