Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday raised its revenue growth forecast for this year to 35 percent after reporting record-high quarterly net profits.
Net profit last quarter hit NT$237.03 billion (US$7.93 billion), up 76.4 percent from a year earlier and 16.9 percent from the previous quarter.
The sole chip supplier of Apple Inc’s iPhones in April estimated that revenue would expand by a percentage in the mid-to-high 20s in US dollar terms this year, driven primarily by chips used in high-performance-computing (HPC) applications, such as servers and data centers.
Photo: Yimou Lee, Reuters
HPC applications have replaced smartphones to become the biggest revenue contributor to TSMC, accounting for about 43 percent last quarter.
For this quarter, revenue is forecast to expand to between US$19.8 billion and US$20.6 billion, from last quarter’s US$18.16 billion, TSMC said.
“Customers’ demand has continued to outpace TSMC’s capabilities this year. Even though they are going through inventory adjustments or have cut their orders, TSMC’s capacity has remained very tight,” TSMC chief executive C.C. Wei (魏哲家) told an online investors’ conference yesterday.
“Factory utilization remains very healthy. That is why we can keep our gross margin intact,” Wei said.
Gross margin is forecast to range from 57.5 percent to 59.5 percent this quarter, compared with a record-high 59.1 percent last quarter, the chipmaker said.
TSMC said the semiconductor supply chain is going through a new inventory correction period, which is expected to carry on through the first half of next year, in the face of faltering demand for smartphones, PCs and consumer electronics.
However, it does not expect customers in the HPC and premium smartphone segments to be overburdened by inventory, it said.
The latest inventory-driven downturn would be a “typical” downcycle, rather than a severe slump like the industry experienced in 2008, TSMC said.
Next year will be another year of growth, it said.
TSMC expects ‘its capacity utilization rate to remain healthy in 2023 and business to be less volatile and more resilient,” thanks to its stronger market position, product differentiation and technological advantages.
The chipmaker does not plan to cut its capital expenditure for this year, as it is upbeat about its long-term business outlook, fueled by increasing silicon content for each electronic device and growing demand for HPC, 5G smartphones and Internet-of-Thing devices.
Due to longer manufacturing equipment delivery time, TSMC expects this year’s capital spending to approach the lower end of its forecast range of US$40 billion to US$44 billion.
Manufacturing equipment used in leading-edge and mature technologies would be affected, it said.
TSMC said it has no plan to build new factories through any joint ventures with customers in the US. Its new US factory is still under construction.
The chipmaker is in discussions with local US governments over subsidies to narrow cost gaps, given higher-than-expected labor costs, TSMC chairman Mark Liu (劉德音) told investors yesterday.
TSMC yesterday reported that earnings per share last quarter climbed to NT$9.14, compared with NT$5.18 a year ago and NT$7.82 in the previous quarter.
Gross margin jumped to 59.1 percent last quarter, beating the chipmaker’s estimate of 58 percent. That was an improvement from 50 percent in the same period last year and 55.6 percent in the first quarter.
US President Donald Trump yesterday announced sweeping "reciprocal tariffs" on US trading partners, including a 32 percent tax on goods from Taiwan that is set to take effect on Wednesday. At a Rose Garden event, Trump declared a 10 percent baseline tax on imports from all countries, with the White House saying it would take effect on Saturday. Countries with larger trade surpluses with the US would face higher duties beginning on Wednesday, including Taiwan (32 percent), China (34 percent), Japan (24 percent), South Korea (25 percent), Vietnam (46 percent) and Thailand (36 percent). Canada and Mexico, the two largest US trading
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
China's military today said it began joint army, navy and rocket force exercises around Taiwan to "serve as a stern warning and powerful deterrent against Taiwanese independence," calling President William Lai (賴清德) a "parasite." The exercises come after Lai called Beijing a "foreign hostile force" last month. More than 10 Chinese military ships approached close to Taiwan's 24 nautical mile (44.4km) contiguous zone this morning and Taiwan sent its own warships to respond, two senior Taiwanese officials said. Taiwan has not yet detected any live fire by the Chinese military so far, one of the officials said. The drills took place after US Secretary
RSS