Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday posted a 12.4 percent decline in revenue for last month from a record-breaking August, heading for an inventory-digesting fourth quarter, like the world’s top contract processor maker has foreseen.
Revenue shrank to NT$43.35 billion (US$1.47 billion) last month, from NT$49.5 billion in August, reaching the lowest level in five months. However, the chipmaker’s third-quarter revenue still grew 10.4 percent sequentially to NT$141.38 billion, setting an all-time high.
Last quarter’s figure was “slightly higher” than the NT$138 billion TSMC forecast in July, just as company spokesperson Lora Ho (何麗梅) revealed last month. TSMC made NT$128.06 billion in revenue in the April-to-June period.
The quarterly growth rate outpaced the 9.4 percent expansion to NT$140.22 billion projected by Credit Suisse analyst Randy Abrams on Monday.
A rise in demand for smartphone chips fueled the growth, Abrams said in a report released on Monday.
He expected TSMC’s net profits to rise 4.1 percent to NT$46.9 billion during the quarter ending on Sept. 30, from the previous quarter’s NT$45.05 billion.
The operating profit margin improved to 36.2 percent, slightly exceeding the company’s July forecast of 36 percent, the report showed.
However, the third quarter is expected to be the peak of this year, as company chairman and chief executive officer Morris Chang (張忠謀) foresees a period of decline amid customer’s inventory correction. He told investors in July that “we will have a dip that will last two quarters.”
This quarter, revenue is expected to slide to NT$127.26, Abrams forecast, meaning a 10 percent quarterly contraction. TSMC’s net profits would increase 17.8 percent annually to NT$158 billion this year, he said.
Abrams cut TSMC’s rating to “neutral” from “outperform,” as the stock price has factored in the company’s future growth and its valuation hit the high end of its historical range at 14.3 times, or NT$1.08 in earnings per share next year, the report said.
In a separate statement, TSMC said it was ready with its “CoWoS” design infrastructure for customers to design three-dimension chips, using 20-nanometer technology. The chipmaker plans to crank out 20nm chips next year.
TSMC shares plummeted 2.24 percent to NT$87.1 yesterday, under-performing the TAIEX’s decline of 0.31 percent. Local rival United Microelectronics Corp’s (UMC, 聯電) stock price rose 0.85 percent to NT$11.9.
UMC’s revenue for last month fell 7 percent month-on-month to NT$9.11 billion, the weakest in six months. However, revenue for last quarter grew 3.26 percent to NT$28.52 billion from the second quarter.
The company said in July that wafer shipments and average selling prices would rise marginally last quarter from a quarter ago.
MStar Semiconductor Inc (晨星半導體) yesterday said revenue increased 4.4 percent to a new record high at NT$3.68 billion last month, compared with NT$3.52 billion in August, thanks to a rise in seasonal demand.
MStar is the world’s biggest supplier of chips used in flat-screen TVs and is scheduled to merge with Taiwan’s top handset chip designer, MediaTek Inc (聯發科), in January.
MStar’s quarterly revenue hit a record quarterly high of NT$10.11 billion, up 12.9 percent from the second quarter’s NT$8.96 billion.