Taiwan Semiconductor Manufacturing Co, the main producer of advanced chips used in artificial intelligence applications, is expected to report a 40% jump in third-quarter profit on Thursday, thanks to soaring demand.
The world’s largest contract chipmaker, which counts Apple and Nvidia among its customers, has benefited from the rise of artificial intelligence.
TSMC is expected to report net profit of NT$298.2 billion ($9.27 billion) for the quarter ended September 30, according to an LSEG SmartEstimate drawn from 22 analysts. SmartEstimates place greater weight on analyst forecasts that are more consistently accurate.
This estimate compares to the net profit for the third quarter of 2023, which amounts to NT$211 billion.
Last week, TSMC reported a jump in its third-quarter revenue in Taiwan dollars, far exceeding market expectations. The company gives its revenue outlook in U.S. dollars during its earnings call.
“Most of TSMC’s major customers, including Apple, Nvidia, AMD, Qualcomm and Mediatek, are launching new products that rely heavily on TSMC’s advanced processing technologies,” said Li Fang-kuo, chairman of President Capital. Management.
“TSMC’s third-quarter earnings will far exceed expectations,” Li added.
TSMC, during its quarterly earnings conference call at 0600 GMT on Thursday, will update its outlook for the current quarter as well as the full year, including its capital expenditures as it strives to increase its production.
TSMC is spending billions to build new factories overseas, including $65 billion for three factories in the US state of Arizona, although it says most manufacturing will remain in Taiwan.
During its last earnings conference call in July, TSMC raised its full-year revenue forecast and adjusted its capital spending plans for this year to between $30 billion and $32 billion. of dollars, compared to a previous forecast of 28 to 32 billion dollars.
The rise of AI has helped drive up the share price of Asia’s most valuable company, with Taipei-listed TSMC’s stock soaring 77% year to date, up from 28 % for the entire market.
TSMC, headquartered in Hsinchu and colloquially called the “sacred mountain protecting the country” because of its crucial role in Taiwan’s export-oriented economy, faces little competition.
Once a dominant force in the semiconductor industry, five-decade-old Intel is facing one of its worst periods as losses pile up at the contract manufacturing unit it is currently shutting down. set up in hopes of competing with TSMC.
($1 = 32.1570 Taiwan dollars)
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