TSMC defies industry-wide downturn, up 78% in Q4 net profit: All Details

Taiwanese chipmaker TSMC posted a 78% increase in fourth-quarter net profit on Thursday, hitting another quarterly record, as strong sales of advanced chips helped it defy the industry-wide downturn. has affected cheaper commodity chips.

Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chip manufacturer and a major player in Apple supplier, saw October-December net profit hit a record TWD295.9 billion (approximately Rs 79,285 crore) from TWD 166.2 billion (Rs 44,540 crore) a year earlier.

That compares with an average of TWD289.44 billion (about Rs 77,570) of 21 analyst estimates compiled by Refinitiv.

TSMC’s business has been boosted by a global chip shortage caused by smartphone and laptop sales caused by the pandemic. While the shortage has eased, analysts say its dominance in making some of the world’s most advanced chips has kept the company’s order books full.

Revenue for the quarter grew 26.7% to $19.93 billion (roughly Rs 5,340 billion), compared with TSMC’s previous estimate range of $19.9 billion to $20.7 billion (roughly Rs 5,545 billion).

TSMC’s share price is down 27.1% in 2022, but is up 8.5% so far this year, giving the company a market value of $412.78 billion (roughly Rs 33,66,055. ). The stock was up 0.4% on Thursday compared with a 0.1% drop for the benchmark index.

Overall, the chip sector is struggling with weak demand for devices such as smartphones as inflation rises and interest rates rise, amid geopolitical tensions.

In October, TSMC cut its annual investment budget by at least 10% for 2022 and issued a more cautious note than usual about upcoming demand, highlighting challenges from rising inflation costs and predict chip recession in 2023.

The company said it spent $36.29 billion (about Rs 2,95,940) on capital expenditures in 2022, compared with a previous forecast of around $36 billion.

TSMC, Asia’s most valuable listed company, has clients that include chip specialists such as Qualcommhas repeatedly said its business will continue to be driven by a “major trend” in the industry, driven by demand for high-performance computing chips for 5G networks and data centers, as well as chip use. in ever-increasing devices and vehicles.

© Thomson Reuters 2023

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