TSMC Q3 profit up 62 percent, demand from China lifts revenue

The record revenue and net income was driven by demand in mobile chips, according to TSMC

Taiwan Semiconductor Manufacturing Co. (TSMC) reported third-quarter net profit was up by 62 percent year-over-year, with the company's revenue beating its original estimate as a result of strong demand for mobile chips.

TSMC's net profit for the quarter ending Sept. 30 was NT$49 billion (US$1.68 billion), up from NT$30 billion in the same period a year ago.

Revenue was NT$141 billion, an increase of 32.8 percent year-over-year from NT$106 billion. TSMC had originally projected revenue for this year's third quarter would range between NT$136 billion to NT$138 billion.

TSMC said part of the reason for the higher shipments was high smartphone demand from China, which has become the world's largest smartphone market by shipments, according to research firms.

TSMC, which is the world's largest contract chip manufacturer, has seen its business grow on higher demand for processors for tablets and smartphones. TSMC's clients include mobile chip vendors Nvidia and Qualcomm, and media reports have indicated a possible partnership between the company and Apple to build its newest chips.

"We expect mobile products to fill TSMC's growth for a number of years," said TSMC CEO Morris Chang during a Thursday earnings call.

For the third quarter, shipments of TSMC's new 28-nanometer chips made up 13 percent of the company's revenue, up from 7 percent in the previous quarter. Demand for TSMC's 28-nanometer chips have been high, and the company expects they will eventually make up more than 20 percent of its revenue at the end of this year's fourth quarter.

"And for the whole year of the next, we expect it to be more than 30 percent of our revenue," Chang said.

The company, however, projects a "dip" in its financial performance in the fourth quarter and in next year's first quarter, due to "supply chain inventory adjustment" with its clients, according to Chang. But in next year's second quarter, the growth will rebound, he added.

TSMC expects the company's fourth quarter revenue will range between NT$129 billion and 131 billion.

The company is already accepting test chips from customers for use in the company's upcoming 20-nanometer chip manufacturing process. TSMC has previously said small-scale production of 20-nanometer chips will start in 2013, with full-production taking place in 2014.

Chang also said the company has purchased 14 hectares (34.5 acres) of land to build a new R&D plant in Taiwan that will focus on the development of its 7-nanometer chip manufacturing process.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags business issuesfinancial resultsTaiwan Semiconductor Manufacturing Co.

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service
Show Comments

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?