Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s top contract chipmaker, yesterday reported a 9.1 percent annual growth in revenue to NT$40.5 billion (US$1.38 billion) last month, an all-time high as restocking demand grew at a faster-than-expected pace.
That was up from NT$37.13 billion last year. On a monthly basis, TSMC’s revenue rose 9.2 percent from NT$37.08 billion.
“This result is in line with our expectation of NT$40.4 billion,” Credit Suisse analyst Randy Abrams said in a research note yesterday. “We expect to see continued month-on-month growth into May and June.”
Last month, TSMC forecast revenue would hit a record high this quarter, ranging between NT$126 billion and NT$128 billion, which would be between 19 percent and 21 percent higher then last quarter’s NT$105.51 billion.
Sales were driven by inventory restocking and growth in the communications sector, Abrams said.
“Orders were stronger than we had expected, which allowed us to have a solid second quarter. Forecasts of incoming orders are also very strong,” TSMC chairman Morris Chang (張忠謀) said at an investor conference on April 26 in Taipei. “This means the third quarter will be a continued-growth quarter.”
Chang said at the time that the worldwide semiconductor market would grow at a faster pace than his previous estimate of 2 percent annual growth in revenue, citing encouraging macroeconomic news from the US and China, which are the chipmaker’s biggest markets.
Excluding the memorychip business, growth would be between 3 percent and 4 percent, he added.
Separately, TSMC plans to spend more than US$1 billion on research and development this year, company spokesman Elizabeth Sun (孫又文) said on the sidelines of a TSMC technology forum in Hsinchu.
That number represents about 8 percent to 9 percent of the chipmaker’s expected total revenue this year, Sun said.
Last year, TSMC spent NT$33.68 billion on research and development, or about 7.9 percent of the company’s revenue of NT$427.08 billion, according to the company’s annual financial statement posted on its Web site.
Because of stronger demand, TSMC was unable to keep up with demand for its 28-nanometer (nm) chips for mobile devices, Chang said last month.
He expected supply constraints to improve in the fourth quarter and to be fully resolved in the first quarter of next year.
TSMC is effectively the sole foundry supplying 28nm chips, Chang said, as rivals such as United Microelectronics Co (UMC, 聯電), Globalfoundries Inc and Samsung Electronics Co have not started mass producing 28nm chips.
The chipmaker expects 28nm chips to make up 20 percent of its revenue in the fourth quarter.
Earlier this week, UMC reported its strongest monthly revenue in nine months at NT$9.12 billion for last month, beating Credit Suisse’s estimate of NT$8.44 billion.
That represented 11.4 percent monthly growth from March’s NT$8.19 billion. However, it was down 4.59 percent from the NT$9.56 billion posted in April last year.
Three experts in the high technology industry have said that US President Donald Trump’s pledge to impose higher tariffs on Taiwanese semiconductors is part of an effort to force Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to the negotiating table. In a speech to Republicans on Jan. 27, Trump said he intends to impose tariffs on Taiwan to bring chip production to the US. “The incentive is going to be they’re not going to want to pay a 25, 50 or even a 100 percent tax,” he said. Darson Chiu (邱達生), an economics professor at Taichung-based Tunghai University and director-general of
‘LEGACY CHIPS’: Chinese companies have dramatically increased mature chip production capacity, but the West’s drive for secure supply chains offers a lifeline for Taiwan When Powerchip Technology Corp (力晶科技) entered a deal with the eastern Chinese city of Hefei in 2015 to set up a new chip foundry, it hoped the move would help provide better access to the promising Chinese market. However, nine years later, that Chinese foundry, Nexchip Semiconductor Corp (合晶集成), has become one of its biggest rivals in the legacy chip space, leveraging steep discounts after Beijing’s localization call forced Powerchip to give up the once-lucrative business making integrated circuits for Chinese flat panels. Nexchip is among Chinese foundries quickly winning market share in the crucial US$56.3 billion industry of so-called legacy
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday held its first board of directors meeting in the US, at which it did not unveil any new US investments despite mounting tariff threats from US President Donald Trump. Trump has threatened to impose 100 percent tariffs on Taiwan-made chips, prompting market speculation that TSMC might consider boosting its chip capacity in the US or ramping up production of advanced chips such as those using a 2-nanometer technology process at its Arizona fabs ahead of schedule. Speculation also swirled that the chipmaker might consider building its own advanced packaging capacity in the US as part
A move by US President Donald Trump to slap a 25 percent tariff on all steel imports is expected to place Taiwan-made steel, which already has a 25 percent tariff, on an equal footing, the Taiwan Steel & Iron Industries Association said yesterday. Speaking with CNA, association chairman Hwang Chien-chih (黃建智) said such an equal footing is expected to boost Taiwan’s competitive edge against other countries in the US market, describing the tariffs as "positive" for Taiwanese steel exporters. On Monday, Trump signed two executive orders imposing the new metal tariffs on imported steel and aluminum with no exceptions and exemptions, effective
RSS