Revenue in the April-June period of this year came in at T$673.51 billion ($20.67 billion), according to Reuters calculations, compared with an LSEG SmartEstimate, drawn from 21 analysts, of T$654.27 billion.
Taiwan Semiconductor Manufacturing, whose customers include Apple and Nvidia, has benefited from the surge towards AI that has helped it weather the tapering off of pandemic-led demand and pushed TSMC's share price to a record high. TSMC is scheduled to announce Q2 earnings results before the market opens on Thursday, July 18th.
Latest Results
TSMC saw January-March net profit rise to T$225.5 billion ($6.98 billion) from T$206.9 billion a year earlier. The profit beat a T$218.1 billion LSEG SmartEstimate by T$7.4 billion, which is weighted toward forecasts from analysts who are more consistently accurate.
TSMC said first-quarter revenue rose 13% year-on-year to $18.87 billion, better than the company's previous forecast of $18 billion to $18.8 billion. The company last week announced first quarter revenue in Taiwan dollars, coming in at T$592.64 billion.
Q2 Guidance
Revenue to be between US$19.6 billion and US$20.4 billion
And, based on the exchange rate assumption of 1 US dollar to 32.3 NT dollars, management expects:
Gross profit margin to be between 51% and 53%
Operating profit margin to be between 40% and 42%
TSMC Numbers May Back Sales, Capex Target Increase
TSMC is poised to beat the top of its $20.4 billion sales guidance for 2Q, driven by robust demand for 3- and 5-nm nodes and CoWoS packaging, primarily used in AI chip production. This momentum also suggests potential upward revision of its 2024 revenue growth target to above 25% from "low to mid-20%." Enhanced pricing power and solid order books from key clients, including Nvidia, Qualcomm and AMD position TSMC favorably against cost pressures from its 3nm scale-up efforts, and may support its gross margin staying about 53% in subsequent quarters.
Key topics for its earnings call include potential capex increases to accelerate 3- and 2-nm capacity build for stronger-than-expected demand from AI and smartphone chip designers, alongside strategies to optimize the underutilized 7-nm capacity.
TSMC Q2 revenue jumps on AI boost, handily beats market forecasts
TSMC reported strong growth in second-quarter revenue on Wednesday that handily beat market forecasts, on the back of booming demand for artificial intelligence (AI) applications.
Revenue in the April-June period of this year came in at T$673.51 billion ($20.67 billion), according to Reuters calculations, compared with an LSEG SmartEstimate, drawn from 21 analysts, of T$654.27 billion.
That represents growth of 32% on-year, compared with $15.68 billion in the year-ago period.
It is not a direct comparison as TSMC provides monthly revenue data only in Taiwan dollars, but gives quarterly revenue figures and its outlook on its quarterly earnings calls both in U.S. dollars.
On its most recent earnings call in April, Taiwan Semiconductor Manufacturing Co forecast second quarter revenue in a range of between $19.6 billion to $20.4 billion.
For June alone, TSMC reported that revenue rose 33% year-on-year to T$207.87 billion.
The company did not provide details in its brief revenue statement.
TSMC, Asia's most valuable publicly listed company with a market capitalisation of $830 billion, did not provide any details or forward guidance in its brief revenue statement.
It is scheduled to report second-quarter earnings on July 18, when it will also update its outlook and plans for the current quarter and the rest of the year.
TSMC is expected to report a 30% on-year rise in second-quarter net profit, according to an LSEG SmartEstimate.
Analysts Boost Targets
“TSMC’s ‘hunger marketing’ strategy seems to be working,” Morgan Stanley analysts including Charlie Chan wrote in a note Sunday. “Our latest supply chain checks indicate that TSMC is delivering a message that leading-edge foundry supply could be tight in 2025 and customers may not get sufficient capacity allocation without appreciating TSMC’s value.”
JPMorgan analysts including Gokul Hariharan also anticipate the company will raise its revenue guidance in the earnings call.
“We expect TSMC to sound more constructive on AI accelerator demand,” he wrote in a note Sunday.
Morgan Stanley and JPMorgan joined brokers including Nomura Holdings Inc. and Mizuho Securities Co. in expressing optimism over TSMC leading into its second-quarter results. The maker of the world’s most advanced chips — used by the likes of Apple Inc. and Nvdia Corp. — is expected to report 36% revenue growth from a year earlier, the fastest pace since the last quarter of 2022, according to data compiled by Bloomberg. The earnings optimism pushed the company’s Taipei shares past NT$1,000 (about $31) last week.
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