Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said its board has approved NT$58.49 billion (US$1.98 billion) in capital spending as part of plans to upgrade its technological process capacity as well as its research and development (R&D) expertise.
The announcement, made in a filing to the Taiwan Stock Exchange after the closure of the stock market, indicates that the world’s largest wafer foundry aims to maintain its technological leadership, despite market concerns about an inventory buildup in the semiconductor supply chain that might weigh heavily on TSMC’s third and fourth-quarter performances.
Last month, TSMC chairman and chief executive officer Morris Chang (張忠謀) said the lack of end-market demand in the second half, especially for high-end smartphones and PCs, could result in inventory adjustments in the supply chain in the second half of the year.
The company said it would fund the investment in equipment with working capital and by issuing corporate bonds.
According to its balance sheet, as of June 30, the company had NT$225.83 billion in cash and cash equivalents, total assets of NT$1.17 trillion and total liabilities of NT$423.65 billion.
In May, the company’s board approved NT$146.08 billion of spending on new equipment and R&D, after it gave the go-ahead for capital appropriations of NT$81.73 billion for such investments in February.
TSMC has proposed spending between US$9.5 billion and US$10 billion on new equipment this year.