Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s top chipmaker on a contract basis, yesterday asked employees to take unpaid leave to help the company cut costs and combat the industrial slump driven by the deepening economic slowdown.
The new cost-cutting measures by the Hsinchu-based chipmaker came as economic turbulence is expected to last several months and could cut into most semiconductor companies’ revenues after driving factory utilization lower.
“Although our performance was very good in the first three quarters of the year, it began to decline rapidly in the fourth quarter,” company chief executive Rick Tsai (蔡力行) said in a video address to employees broadcast online yesterday.
FIVE DAYS
“It looks as if this period of economic weakness will last for a fairly long time, and business will become more difficult,” Tsai said. “The company must do its utmost to lower costs. At the same time, we will also do all we can to protect employees’ jobs.”
Employees at manufacturing departments have been asked to take five unpaid furloughs a month beginning this month on the back of falling factory utilization.
Starting next month, staff in all other departments will be asked to take one unpaid leave a week.
TSMC has been forced to take more stringent cost-control measures as it lowered its fourth-quarter outlook in response to shrinking demand.
FORECAST CUTS
On Monday, it slashed more than 8 percent from its revenue forecast for this quarter and cut its gross margin forecast by 4 percentage points.
More than one month ago, TSMC said it was considering slashing 20 percent from its capital spending for next year from US$1.8 billion this year.
To help employees reduce the effect of their lower monthly pay because of the reduction in working days, TSMC planned to allocate a portion of it’s profit-sharing distribution to help make up the shortfall in regular monthly income, Tsai said.
On Tuesday, US President Donald Trump weighed in on a pressing national issue: The rebranding of a restaurant chain. Last week, Cracker Barrel, a Tennessee company whose nationwide locations lean heavily on a cozy, old-timey aesthetic — “rocking chairs on the porch, a warm fire in the hearth, peg games on the table” — announced it was updating its logo. Uncle Herschel, the man who once appeared next to the letters with a barrel, was gone. It sparked ire on the right, with Donald Trump Jr leading a charge against the rebranding: “WTF is wrong with Cracker Barrel?!” Later, Trump Sr weighed
HEADWINDS: Upfront investment is unavoidable in the merger, but cost savings would materialize over time, TS Financial Holding Co president Welch Lin said TS Financial Holding Co (台新新光金控) said it would take about two years before the benefits of its merger with Shin Kong Financial Holding Co (新光金控) become evident, as the group prioritizes the consolidation of its major subsidiaries. “The group’s priority is to complete the consolidation of different subsidiaries,” Welch Lin (林維俊), president of the nation’s fourth-largest financial conglomerate by assets, told reporters during its first earnings briefing since the merger took effect on July 24. The asset management units are scheduled to merge in November, followed by life insurance in January next year and securities operations in April, Lin said. Banking integration,
LOOPHOLES: The move is to end a break that was aiding foreign producers without any similar benefit for US manufacturers, the US Department of Commerce said US President Donald Trump’s administration would make it harder for Samsung Electronics Co and SK Hynix Inc to ship critical equipment to their chipmaking operations in China, dealing a potential blow to the companies’ production in the world’s largest semiconductor market. The US Department of Commerce in a notice published on Friday said that it was revoking waivers for Samsung and SK Hynix to use US technologies in their Chinese operations. The companies had been operating in China under regulations that allow them to import chipmaking equipment without applying for a new license each time. The move would revise what is known
Artificial intelligence (AI) chip designer Cambricon Technologies Corp (寒武紀科技) plunged almost 9 percent after warning investors about a doubling in its share price over just a month, a record gain that helped fuel a US$1 trillion Chinese market rally. Cambricon triggered the selloff with a Thursday filing in which it dispelled talk about nonexistent products in the pipeline, reminded investors it labors under US sanctions, and stressed the difficulties of ascending the technology ladder. The Shanghai-listed company’s stock dived by the most since April in early yesterday trading, while the market stood largely unchanged. The litany of warnings underscores growing scrutiny of
RSS