This year, TSMC's Taiwan-listed shares have increased by about 70% due to the surge in demand for sophisticated circuits used in artificial intelligence platforms.
In the cloud and at the periphery, there is an increasing demand for generative AI. In advance of the findings, Brady Wang, associate director of Counterpoint Research, stated on Friday that "TSMC's N3 process boasts good yield rates and well-managed production lines."
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| TSMC offices on Thursday, April 18, 2024, in San Jose, California, USA. image for WSJ |
Manufacturer of Semiconductors in Taiwan
Thursday exceeded second-quarter revenue and profit projections due to the ongoing increase in demand for sophisticated processors used in artificial intelligence applications.
In comparison to the LSEG consensus estimates, these are TSMC's second-quarter results:
1. Revenue: NT$657.58 billion predicted, but only 673.51 billion New Taiwan dollars ($20.82 billion) were received.
2. Net income: NT$247.85 billion as opposed to the projected NT$238.8 billion
According to TSMC, net income jumped by 36.3% to NT$247.85 billion from a year ago, while net sales increased by 40.1% to NT$673.51 billion. The company predicted sales for the second quarter to range from $19.6 billion to $20.4 billion.
This year, TSMC's Taiwan-listed shares have increased by about 70% due to the surge in demand for sophisticated circuits used in artificial intelligence platforms.
While competitors like Samsung and Intel have been attempting to threaten TSMC's dominance, the company is still the world's leading manufacturer of sophisticated chips, which are used in everything from smartphones to AI applications. Among its customers are Nvidia and Apple.
The massive chip manufacturer presently manufactures 3-nanometer chips and intends to start producing 2-nanometer chips in large quantities in 2025. Generally speaking, processors with smaller nanoscale sizes are more potent and effective.
In the cloud and at the periphery, there is an increasing demand for generative AI. The N3 process from TSMC has well-managed manufacturing lines and good yield rates. Before the results were released on Friday, Brady Wang, associate director of Counterpoint Research, stated that the business is well-funded and that regional political issues are driving growing demand for advanced procedures.
According to Wang, compared to 2024, the 3-nanometer process's capacity is anticipated to more than double.
Needham analysts reiterated their "buy" rating on Monday and stated that they anticipate TSMC to increase its revenue growth target for 2024. They also raised the price objective for the chip giant's U.S.-listed shares to $210 from $168.
During the forthcoming earnings call, Needham stated in a note, "We expect TSMC to raise its 2024 revenue growth outlook from 'low- to mid-20s' to'mid- to high-20s' but maintain its 2024 [capital expenditures] target at $30 billion."
According to data from Counterpoint Research, TSMC increased its share of the worldwide foundry market to 62% in the first quarter from 59% during the same period last year.
