Q&A（Question-and-Answer Session）is a session after the company's prepared remarks where institutional investors and analysts ask management questions. In this dialogue, you may find some valuable information that might affect the stock price in the following weeks.
Now let's look at some key points from TSM Q1 2023 Q&A Session Transcript $Taiwan Semiconductor Manufacturing(TSM)$
Q:I believe as we expand our footprint and capacity beyond Taiwan and go overseas, what will be the ASP trend in the next few years. Is that correct?
A:First, actually, our pricing strategy actually is strategic and long term. We work with our customer. Yes, you are right. I mean, that the inflation or all others, the cost is increasing, especially in the overseas fab.However, we already put all those kind of things into consideration. And we have a lot of action items to work with internally and also with our partners, our supply partners and to lower down all the costs. And we're also working on the supply chain management. So we hope that we will control that, even with today's very tough situation.
Q:If we look at the equipment lead time, are you seeing ongoing improvement? What I'm trying to understand, if you need to tighten up the CapEx. But let's say, if later on, demand start to recover or get better into second half of the year, how much flexibility you have to pull in the equipment?
A:We are tightening up on the CapEx. But at the same time, we also remain flexible that once the demand pick up quickly, we should be have prepared enough capacity for our customers to grow.And so both factors are very important, and we are working with all the suppliers preparing for that. In fact, we are planning our long-term capacity expansion and then with some kind of adjustment in between.We have a flexibility to increase quickly. We also have a flexibility to tighten the CapEx. But the main trend stays the same because we believe AI, 5G, the megatrend will continue to grow, and TSMC business will continue to grow.
Q:Your guide for June and also 2023 revenue suggests revenues in the second half of the year would be up by 25% versus the first half. And what I want to better understand is how will new product ramps drive this growth.Is there anything quantitative or qualitative that you can offer us to understand the mechanics or the drivers behind this 25% growth in revenue from first half into the second half?
A:To give you a hint, I mean, that we talk about customer's new product launch and which use a 3-nanometer. So you can understand that we start to ramp up 3-nanometer quickly because it fully utilize and still not enough to meet customers' demand. In addition to that, actually, all the platforms, their performance, their demand will increase in the second half.
The above Q&A are highlights that are edited for brevity. Click here for the full TSM Q1 2023 Earnings Call Transcript.
If you want to know more details, you can click here to re-watch the TSM Q1 2023 Earnings Conference Call
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