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Taiwan Semi shares rise after earnings, sales beat forecasts

Shares of Taiwan Semiconductor Manufacturing Co. rose on Thursday after the third-party silicon wafer manufacturer reported forecast-beating earnings and sales in its June-ending quarter.

TSMC TSM, +2.77% 2330, +0.96% reported earnings of $1.55 per American depositary receipt compared with 93 cents per ADR in the year-ago period. Revenue rose to $18.16 billion from $13.29 billion in the year ago period. TSMC had estimated revenue between $17.6 billion and $18.2 billion.

Analysts surveyed by FactSet had forecast earnings of $1.44 per ADR and revenue of $17.68 billion. Shares of the company rose 3% in Taipei.

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Breaking it down by technology, leading-edge 5-nanometer orders made up 21% of sales, compared with 18% in the year-ago period, while 7-nm orders made up 30% of sales from a previous 31%. Nanometer, or “nm,” denotes the size of each transistor that goes on a computer chip, the general rule being that smaller transistors are faster and more efficient in using power.

By end-use, smartphone customers made up 38% of revenue compared with a year-ago 42%, while high-performance computing customers made up 43% of sales, compared with 39% in the year-ago period. Demand for smartphones and PCs has weakened from a year ago, although analysts expect data-center demand to remain resilient.

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Automotive customers contributed to 5% of TSM’s revenue, compared with 4% in last year’s June-ending quarter, when chip fabricators started reserving more capacity for auto customers, who were one of the hardest hit industries by the chip shortage in 2021.

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