TSMC’s first-quarter profit rises 19% on strong chip demand By Reuters
TAIPEI (Reuters) – Taiwan Semiconductor Manufacturing Co Ltd (TSMC) reported a 19.4% rise in first-quarter profit that beat market expectations on strong global chip demand for the world’s top contract chipmaker.
TSMC, whose clients include Apple Inc (NASDAQ:AAPL) and Qualcomm (NASDAQ:QCOM) Inc, had already flagged “multiple years of growth opportunities” as the COVID-19 pandemic fuelled demand for advanced chips to power devices such as smartphones and laptops.
The Taiwanese company’s business was further boosted by a global shortage of semiconductor chips that initially forced automakers to cut production, but is now also hurting manufacturers of smartphones, laptops and even appliances.
TSMC’s net profit for January-March hit T$139.7 billion ($4.93 billion), versus the T$134.01 billion average of 22 analyst estimates compiled by Refinitiv.
Revenue rose 25.4% to a record $12.92 billion, in line with the company’s earlier estimated range of $12.7 billion to $13 billion.
TSMC said this month it plans to invest $100 billion over the next three years to increase capacity at its plants, days after Intel Corp (NASDAQ:INTC) announced a $20 billion plan to expand its advanced chip making capacity.
The Taiwanese company had already flagged a plan to spend $25 billion to $28 billion this year to develop and produce advanced chips.
Analysts are bullish about the company’s massive expansion plan, expecting global demand for advanced chips to surge as fifth-generation telecommunications (5G) technology and artificial intelligence applications are adopted more widely.
TSMC shares have risen about 16% so far this year and have more than doubled over the past one year, giving TSMC a market value of $558 billion, more than twice that of Intel’s and higher than that of South Korean technology giant Samsung Electronics (LON:0593xq) Co Ltd.
($1 = 28.3170 Taiwan dollars)