Taiwan chip giant TSMC posted a 13.8 percent jump in third-quarter profit on Thursday on the back of booming demand for semiconductors to power smartphones and other gadgets during the COVID-19 pandemic amid a supply crunch.
TSMC, the world’s largest contract chipmaker and a key supplier to Apple, posted a net profit of T$156.3 billion (AU$7.69 billion) in July-September, well above the T$149 billion average of 22 analyst estimates compiled by Refinitiv.
Advanced chips made by TSMC, formally known as Taiwan Semiconductor Manufacturing Co, are used in everything from high-end smartphones like Apple’s newly unveiled 5G iPhone 13, to artificial intelligence, cars and a wide variety of lower-end consumer goods.
TSMC and Taiwan in general have also become central in efforts to resolve a pandemic-induced global chip shortage, which has forced automakers to cut production and hurt manufacturers of smartphones, laptops and consumer appliances.
“Our third-quarter business was mainly supported by strong demand across all four growth platforms,” chief financial officer Wendell Huang told an analyst conference, referring to strong chip demand including those for smartphones, cars and “Internet of Things” – the concept of connecting household devices to the Internet.
“Moving into fourth quarter 2021, we expect our business to be supported by strong demand for our industry-leading 5 nanometre technology.”
The company lifted its revenue growth forecast for 2021 to about 24 percent, versus an earlier forecast of above 20 percent, citing an “industry megatrend” of strong chip demand.
TSMC’s revenue for the quarter climbed 22.6 percent to US$14.88 billion, in line with the company’s prior estimated range of US$14.6 billion to US$14.9 billion.
For the quarter ending in December, TSMC forecast revenue of US$15.4 billion to US$15.7 billion, compared with US$12.68 billion in the same period a year earlier.
TSMC shares have risen about 8.5 perccent so far this year, giving it a market value of US$526.3 billion, more than double that of competitor and client Intel.
They closed up 0.4 percent on Thursday, broadly in line with a 0.2 percent rise in the broader market.
(US$1 = 28.0950 Taiwan dollars)
(Reporting by Yimou Lee and Ben Blanchard; Editing by Christopher Cushing and Ana Nicolaci da Costa)Got a news tip for our journalists? Share it with us anonymously here.