A picture of a semiconductor wafer on the Taiwan Semiconductor Manufacturing Museum of Innovation in Hsinchu, Taiwan, on Jan. 11, 2022.
I-Hwa Cheng | Bloomberg | Getty Photos
Taiwan Semiconductor Manufacturing Firm on Thursday reported a 54% hike in web revenue within the third quarter and forecast annual income development within the final three months of the yr, as international chipmakers proceed to profit from demand boosted by AI functions.
The corporate’s web earnings was 325.3 billion Taiwanese {dollars} ($10.1 billion) over the July-September quarter, surpassing an LSEG estimate of $300.2 billion Taiwanese {dollars} cited by Reuters.
U.S.-listed shares had been up 6.62% at 4:39 a.m. ET in premarket buying and selling.
TSMC is the world’s largest producer of superior chips, serving purchasers equivalent to Apple and Nvidia.
Internet income got here in at $23.5 billion within the third quarter, up 36% year-on-year, with TSMC’s gross margin rising to 57.8% over July-September, in contrast with 54.3% in the identical interval of final yr.
“Primarily based on the present enterprise outlook, we anticipate for our fourth-quarter income to be between $26.1 billion and $26.9 billion, which represents a 13% sequential improve or a 35% year-over-year improve on the midpoint,” TSMC Chief Monetary Officer Wendell Huang stated throughout an earnings name following the outcomes launch, based on a name transcript produced by FactSet.
Within the third quarter, “our enterprise was supported by sturdy smartphone and AI-related demand for our trade main 3nm and 5nm applied sciences,” TSMC stated in a press release, referencing its semiconductor nodes.
Within the Thursday earnings name, TSMC Chairman and CEO C.C. Wei careworn that AI demand is “actual” and that the corporate has skilled the “deepest and widest development of anybody on this trade,” because of this.
“Now we have talked to our clients on a regular basis, together with our hyperscaler clients who’re constructing their very own chips. And virtually each AI innovator is working with TSMC,” he stated.
The corporate’s Taipei-listed shares have soared almost 80% year-to-date, outpacing the 28.57% features of the broader market over the identical interval.
TSMC now anticipates its capital expenditure for this yr will choose as much as barely greater than $30 billion, it stated throughout its earnings name. The agency’s capex prices edged greater to $6.4 billion within the third quarter, versus $6.36 billion throughout the three previous months.
The Taiwanese chipmaker, whose superior chips are important to a swathe of merchandise starting from smartphones to AI functions, has been growing its manufacturing presence worldwide, finishing up an enormous abroad funding of $65 billion for 3 chip crops in Arizona to fulfill U.S. demand, in addition to opening its first manufacturing facility in Japan earlier this yr.
TSMC’s earnings beat comes the identical week as Netherlands-based ASML, which provides machines to the Taiwanese firm, issued a lower-than-expected forecast of web gross sales, sending shares tumbling.
Some market individuals have questioned the long-term resilience of the AI increase and the return on growing investments within the expertise sector — whereas Younger Liu, CEO and chairman of key Apple provider Foxconn, instructed CNBC final week that the AI frenzy “nonetheless has a while to go,” as superior language fashions evolve with every new iteration.
Correction: This text has been up to date to precisely replicate that TSMC’s third-quarter web earnings hit 325.3 billion Taiwanese {dollars}.
