TSMC offices in San Jose, California, U.S., on Thursday, April 18, 2024.
David Paul Morris | Bloomberg | Getty Images
- Gain: 673.51 billion new Taiwan dollars ($20.82 billion), versus expected NT$657.58 billion
- Net income: NT$247.85 billion, vs. NT$238.8 billion expected
TSMC reported that net revenue rose 40.1% from a year ago to NT$673.51 billion, while net income rose 36.3% from a year ago to NT$247.85 billion. The company forecast second-quarter revenue to be between $19.6 billion and $20.4 billion.
Rising demand for advanced chips for use in AI applications has sent TSMC’s shares on the Taiwanese stock exchange soaring nearly 70% so far this year.
TSMC is the world’s largest maker of advanced chips found in everything from smartphones to AI applications, though rivals including Samsung and Intel have tried to challenge its dominance. It counts Apple and Nvidia among its customers.
The chip giant is currently producing 3-nanometer chips and plans to begin mass production of 2-nanometer chips in 2025. Typically, a smaller nanometer size results in more powerful and efficient chips.
“Demand for generative AI is increasing in the cloud and at the edge. TSMC’s N3 process has good yield rates and well-managed production lines. The market is well-funded and regional political factors are driving increased demand for advanced processes,” Brady Wang, associate director of Counterpoint Research, said Friday ahead of the results.
Wang said the capacity of the 3-nanometer process is expected to more than double by 2024 from the previous year.
Analysts at Needham said Monday they expect TSMC to raise its revenue growth target for 2024, reiterating a “buy” rating and raising the price target on the chip giant’s U.S.-listed shares to $210 from $168.
“We expect TSMC to raise its revenue growth outlook for 2024 from ‘low to mid 20s’ to ‘mid to high 20s’, but maintain its outlook for 2024 [capital expenditures] “The goal is to invest $30 billion in the upcoming earnings report,” Needham said in a note.
According to data from Counterpoint Research, TSMC held a 62% share of the global foundry market in the first quarter, up from 59% in the same period a year ago.
This is breaking news. Check back later for updates.