Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) third-quarter revenue slid less than projected as demand from artificial intelligence (AI) players helped offset sagging smartphone and laptop chip sales.
TSMC, the main chipmaker for Apple Inc and Nvidia Corp, reported July-September revenue of NT$546.7 billion (US$16.97 billion), Bloomberg reported.
That marked an 11 percent decline on the prior year, but beat the average estimate of NT$531.5 billion.
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Data centers driving AI are boosting demand for some of TSMC’s biggest clients, including Nvidia, along with memory used with those systems. The preliminary sales numbers come as investors look for signs that climbing orders for AI chips are overcoming supply constraints and translating into sales, and might allay concerns of a prolonged sector-wide slump.
TSMC is the primary contract manufacturer of Nvidia’s AI accelerator chips, widely sought to train large data models such as the one underpinning OpenAI’s ChatGPT.
Strong demand for TSMC’s advanced packaging service might also bolster sales, even as the semiconductor sector works through excess inventory, Bloomberg Intelligence analyst Charles Shum (沈明) said.
Favorable exchange rates could further help its profit margin, he said.
Investors would be focusing on the Taiwanese firm’s outlook when it reports July-September earnings on Oct. 19. TSMC is seen as a bellwether for the tech sector, amid concern for slowing sales growth at tech giants such as Apple.
TSMC’s stock closed about 0.8 percent higher in Taipei yesterday. Its shares have gained more than 18 percent since earlier this year.
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