Menu
Chipmaker TSMC reports earnings up 5 percent on record Q3 revenue

Chipmaker TSMC reports earnings up 5 percent on record Q3 revenue

TSMC expects to see revenue fall quarter-over-quarter on soft demands for high-end smartphones

Taiwan Semiconductor Manufacturing Co. saw net profit for the third quarter rise 5 percent year on year as revenue hit a record, but the chipmaker warned that this could slip later in the year due to a slowdown in demand for high-end smartphones.

Net profit totalled NT$52 billion (US$1.8 billion), up from the NT$49.4 billion in the same period last year, TSMC reported on Thursday. Revenue came in at NT$162.6 billion, a year-over-year increase of 14.9 percent.

TSMC has continually reported strong earnings from its contract chip manufacturing business, which builds mobile processors for vendors including Qualcomm and Nvidia. The company estimates about a third of its revenue comes from chips for smartphones and tablets.

The company's 28-nanometer chip manufacturing process, used to build faster and more power-efficient processors, generated 32 percent of revenue in third quarter, the largest sales driver of any of the company's manufacturing processes.

But TSMC expects soft demand for high-end smartphones in the fourth quarter will put a damper on its own revenues in the period, CEO Morris Chang said during a conference call to discuss earnings. "We believe this decline is short term," he said, adding that handset vendors need time to clear out their existing inventories.

He expects a quarter-on-quarter decline in fourth-quarter revenue to between NT$144 billion and NT$147 billion.

However, TSMC remains optimistic about its chip business. In the first quarter the company will begin volume manufacturing of chips using its new 20-nanometer process, which can offer 30 percent higher chip speeds over its 28-nanometer technology.

At the same time, demand for tablets and smartphones will continue to grow, and the need for mobile chips could extend to wearable devices such as smartwatches, Chang said.

The 82-year-old Chang said Thursday that he will step down from his position as company CEO, but plans to remain on as a "hands-on" chairman. TSMC will name a new CEO or co-CEOs by next June.


Follow Us

Join the newsletter!

Error: Please check your email address.

Tags smartphonestabletsprocessorshardware systemsconsumer electronicstsmcComponents

Featured

Slideshows

Looking back at the top 15 M&A deals in NZ during 2017

Looking back at the top 15 M&A deals in NZ during 2017

In 2017, merger and acquisitions fever reached new heights in New Zealand, with a host of big name deals dominating the headlines. Reseller News recaps the most important transactions of the Kiwi channel during the past 12 months.

Looking back at the top 15 M&A deals in NZ during 2017
Kiwi channel closes 2017 with After Hours

Kiwi channel closes 2017 with After Hours

The channel in New Zealand came together to celebrate the close of 2017, as the final After Hours played out in front of a bumper Auckland crowd.

Kiwi channel closes 2017 with After Hours
Meet the top performing HP partners in NZ

Meet the top performing HP partners in NZ

HP honoured leading partners across the channel at the Partner Awards 2017 in New Zealand, recognising excellence across the entire print and personal systems portfolio.

Meet the top performing HP partners in NZ
Show Comments