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Highlights:
- TSMC, the world’s largest contract chipmaker, posted robust second-quarter revenue, outpacing estimates.
- The semiconductor industry is pegged at US$550 billion, of which TSMC is a major player.
- TSMC’s top customer is Apple Inc. (AAPL), a contributor to its revenue.
The world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Company Ltd. (TSM), reported better-than-expected quarterly revenue lifted by strong demand for chips, Bloomberg reported on Friday.
It booked revenue of US$17.9 billion in the second quarter of fiscal 2022.
The report said that with its stellar quarterly performance, TSMC, the most important chipmaker for Apple Inc. (Nasdaq:AAPL), could allay investors’ fears that semiconductor demand was weakening amid rising costs in the US$550 billion semiconductor industry.
Another tech giant, Samsung Electronics Co., also posted better than anticipated revenue.
Although concerns remain about a protracted impact of a potential recession globally, investors still assume that TSMC will be able to surpass its goal of growing sales by 30% this year.
Analysts quoted by Bloomberg said that TSMC’s third-quarter revenue is likely to outgrow consensus, propelled by its price hike and new product launches by Apple.
© Tihis | Megapixl.com
TSMC benefits from its association with AAPL
As the world’s most advanced maker of silicon chips, TSMC has immensely benefitted from its business with Apple Inc. Since the start of 2021, Apple has already launched five types of Mac chips.
TSMC also gained due to the rising demand for semiconductors in the auto industry, with more and more cars becoming digitized.
Issues with chip supply that crippled the gadget companies and carmakers for over a year have begun to subside. Auto executives agree that component supply has improved, and delivery of chips is also more or less timely.
Bottom line:
TSMC shares closed up 2.1% on Friday, just before the revenue announcement. However, they are still down 24% YTD, assailed by a broader tech selloff on recession fears.
