Taiwan Semiconductor Manufacturing Co (TSMC), the leading manufacturer of cutting-edge chips essential for artificial intelligence functions, is anticipated to unveil a 5 percent increase in first-quarter earnings, fueled by robust demand. As the primary supplier to tech giants like Apple and Nvidia, TSMC has capitalized on the flourishing AI market, which has shielded it from the slowdown in pandemic-induced electronics consumption. This resilience has propelled TSMC's stock to unprecedented heights, underscoring its pivotal role in the global semiconductor landscape.
TSMC is poised to disclose a net profit of T$218.1 billion (US$6.74 billion) for the quarter concluding on March 31, as per an LSEG SmartEstimate derived from insights provided by 22 analysts. SmartEstimates allocate more weight to predictions from analysts with a proven track record of accuracy. This figure stands in contrast to the net profit of T$206.9 billion recorded in the same quarter last year.
TSMC last week reported a 16.5 percent rise in first-quarter revenue, beating market expectations and at the high end of the company’s own guidance. The company will provide updates on its outlook for the current quarter and the rest of the year on an earnings call at 0600 GMT, including capital expenditure which it has previously guided as being in the range of US$28 billion to US$32 billion this year, compared with last year’s US$30.45 billion.
ASML, the primary provider of equipment to semiconductor manufacturers such as TSMC, revealed first-quarter new bookings below initial expectations, despite resilient sales to China amidst restrictions imposed by the US. Executives may also address TSMC's developments in Arizona, where the company intends to construct a third factory following its acquisition of US$6.6 billion in subsidies.
TSMC stands at the forefront of advanced chip manufacturing, catering to a diverse range of applications spanning from smartphones and tablets to fighter aircraft. However, rivals such as Intel and Samsung are endeavoring to contest the company's supremacy. Intel recently announced a worsening trend of operating losses in its foundry business, dealing a significant setback to the chip giant's efforts to reclaim the technological edge it relinquished to TSMC in recent years.
The surge in demand for artificial intelligence has contributed to the remarkable increase in the share price of Asia's most valuable company. TSMC's stock listed in Taipei has skyrocketed by over 30 percent since the beginning of the year, reaching an all-time high, in contrast to a 12 percent uptick in the broader market.