Buy 1 Get 1 30%OFF. Free Shipping Worldwide

TSMC Expects 30% Q3 Profit Decline, Eyes Growth Ahead

Taiwan Semiconductor Manufacturing Co Ltd (TSMC) is set to reveal a 30% drop in third-quarter profits, reflecting a slowdown after last year's pandemic-fueled demand surge. The world's leading contract chipmaker is expected to report a net profit of $6 billion for July-September, marking its second consecutive quarter of profit decline. Revenues for the quarter stood at around $17 billion, a 20% decrease from the previous year, within the company's forecast range.

The semiconductor industry has faced a slowdown since the latter part of the previous year, with global demand weakening. However, industry analysts anticipate a rebound as inventories at smartphone and computer manufacturers dwindle, necessitating restocking.

Much attention is focused on TSMC's outlook for the fourth quarter and beyond. Morgan Stanley analysts foresee a 10% revenue growth for Q4, and they suggest that TSMC's guidance could surpass expectations due to strong demand for high-end chips used in artificial intelligence applications.

The surge in AI technology has driven TSMC's stock price up by 23% this year, making it Asia's most valuable company. LSEG SmartEstimates project a 22% revenue growth for TSMC in 2024, indicating confidence in the company's long-term prospects.

However, there are concerns about short-term issues. TSMC has urged its primary suppliers to delay the delivery of high-end chip-making equipment due to uncertainty in customer demand, though these delays are expected to be temporary.

Some analysts, such as Fubon Securities, remain cautious about TSMC's immediate future. They predict a slow start to the next year, with a 10% growth in the first quarter. Worries persist regarding potential order cancellations and subdued restocking demand, particularly related to major customer Apple.

In summary, TSMC's expected decline in third-quarter profits is seen as a temporary setback following exceptional performance during the pandemic. Industry experts anticipate a rebound in the semiconductor market, driven by restocking demand and the strong demand for high-end chips in AI applications. Despite some short-term concerns, TSMC remains a formidable force in the semiconductor industry.

Leave a comment

Name .
Message .

Please note, comments must be approved before they are published