Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, raised its first-quarter outlook yesterday on the back of growing rush orders based on rising demand from China and the strengthening US dollar.
“TSMC’s first-quarter business is expected to be better than the company’s previous guidance given on January 22, 2009,” TSMC chief financial executive Lora Ho (何麗梅) said in a statement. “This is primarily due to rush orders, especially from the mainland Chinese market, and a stronger US dollar.”
TSMC expects first-quarter revenue to be between NT$36 billion and NT$38 billion (US$1.04 billion and US$1.1 billion), up from the NT$32 billion to NT$35 billion TSMC estimated in January.
The new estimate, however, is a 40 percent decline from last quarter’s NT$64.56 billion.
Operating profit margin may range from flat to negative 2 percent, which is also better than the company’s previous estimate of between minus 19 percent and minus 15 percent, TSMC said.
Gross margin may range between 14 percent and 16 percent in the current quarter, rather than between 1 percent and 5 percent as previously estimated, the statement said.
The revision, the latest in a slew of outlook upgrades by chip companies including Macronix International Co (旺宏電子) and MediaTek Inc (聯發科), might help TSMC avoid posting its first quarterly loss since the 1990s for the current quarter, which ends March 31.
TSMC chief executive Rick Tsai (蔡力行) told investors in January the Hsinchu-based chipmaker might swing into losses this quarter, saying the bleak economy had hurt demand for all kinds of electronics.
“A stronger US dollar should be the main factor bringing TSMC’s bottom line back to the break-even point from the brink of falling into losses. Falling non-operating losses will also help,” a semiconductor analyst with KGI Securities Co Ltd (凱基證券) said on condition of anonymity.
“February should be the worst period for TSMC,” the analyst said, adding that the effect of rush orders would magnify in the second quarter mainly from growing orders from handset chipmakers Broadcom Corp and Qualcomm Inc.
TSMC sales reached NT$12.18 billion last month, down 58.4 percent from NT$29.28 billion a year ago, or down 7.3 percent month-on-month, the company said. In the first two months, revenues totaled NT$25.3 billion.
TSMC shares dropped 2.28 percent to NT$47.15 yesterday, underperforming the TAIEX, which gained 0.92 percent.
The company provided its revised guidance after the stock market closed.
United Microelectronics Corp (聯電) shares rose 1.44 percent to NT$9.15 yesterday. The company reported a 57 percent year-on-year decline on Monday, or 0.29 percent month-on-month decline, in sales last month at NT$3.14 billion.
Shares in Taiwan closed at a new high yesterday, the first trading day of the new year, as contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) continued to break records amid an artificial intelligence (AI) boom, dealers said. The TAIEX closed up 386.21 points, or 1.33 percent, at 29,349.81, with turnover totaling NT$648.844 billion (US$20.65 billion). “Judging from a stronger Taiwan dollar against the US dollar, I think foreign institutional investors returned from the holidays and brought funds into the local market,” Concord Securities Co (康和證券) analyst Kerry Huang (黃志祺) said. “Foreign investors just rebuilt their positions with TSMC as their top target,
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