What is the sales breakdown for a company like AMD?
I would imagine that sales of the cutting edge parts are a tiny niche catering to enthusiasts and tech companies.
Even a highend computer has a number of support chips which don't need to be fabbed on the latest process.
Sales of mid to low range equipment are MUCH higher than the top models. Most users don't buy the cutting edge equipment, they buy in the sweet spot of the price/performance curve. Corporate bulk purchases also do the same - either looking for the best price/performance ratio, or just going for cheap. Only a tiny subset of the market is willing to pay 50% more $ for 10% more performance.
Intel are behind TSMC sure, but not so far behind. They can easily manufacture these second tier parts that make up the bulk of the market. Intel themselves are using TSMC for their small niche highend chips while manufacturing their mass market products themselves.
AMD can probably comfortably produce 95% of their products on a second tier process node. For the 5% of highend products that need to be fabbed by TSMC the target market are willing to pay a premium so they can afford to pay the tariffs.