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TSMC Performed Well In the Last Quarter Despite Constraints

Nearly 44 percent more sales than a year ago, plus more than 76 percent more profit: at least there are no signs of a slowdown in the market at TSMC. In a quarterly comparison, each business area grew again, the PC segment is now back in the lead and the 5nm nodes are making headway.

Despite the headwind, no crash in sight

The year will continue to be a very good year, said CC Wei, CEO of TSMC. Demand will also outpace supply for the rest of the year, and the forecast will remain the same for a long time to come, despite the current initial inventory adjustments and uncertainties at some companies. TSMC still sees a growth of 15 to 20 percent per year in the long term and does not expect a crash like that of 2008. The company does want to postpone part of the planned expenditure from 2022 to 2023 due to a lack of equipment. So this year’s CAPEX will be at the lower end of the $40 billion to $44 billion forecasts.

For a moment it goes up very steep again. Up to 20.6 billion sales are targeted in the current third quarter, and the high margins should remain as well. The upcoming wave of new products in both the smartphone and PC sectors is clearly casting a shadow here. Because TSMC has already pre-manufactured a lot of N5 wafers in the second quarter, which has led to an increase in inventory. These will be redeemed shortly.

Very good last quarter

In the second quarter of this year, TSMC posted revenue of $18.158 billion and a net income of more than $8 billion. This corresponds to a growth of 43.5 percent in sales and 76.4 percent in net profit compared to the same period last year. TSMC now accounts for 21 percent of wafers and N5 chip sales, while all N7-based offshoots still account for 30 percent. This mix continues to push the PC segment a little further forward, with 43 percent of sales coming from this segment in the last quarter.

Earnings by platform (Image: TSMC) Sales by technology (Image: TSMC) There were no new products to report for the upcoming production phases N3, N3E, and N2, but the latest status of the latest production solutions is only a few weeks old. As planned, N3 will contribute to sales for the first time in early 2023, with production expected to start at the end of 2022. Higher prices for the products are expected here than for N5 solutions. The ComputerBase report details TSMC’s strategies: “Too big to fail”

Mark Goodman

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