Conditions continue to work in favor of Taiwan Semiconductor Manufacturing (TSMC) ( TSM -3.19%). The world's largest chip producer already controls two-thirds of the foundry market, according to TrendForce. Moreover, with artificial intelligence (AI) demand growing at a rapid clip, the need for the chips it produces only continues to rise.

Taiwan Semiconductor Manufacturing faces a host of challenges that have weighed on TSM stock lately. But TSM stock rose Wednesday.