Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said revenue for this quarter would be near the lower end of its guidance due to a magnitude 6.4 earthquake on the Richter scale that struck southern Taiwan last month.
The quake, which struck the southeastern part of Chaiyi County on Jan. 21, is estimated to cause TSMC losses of about NT$5.3 billion (US$161.4 million) in the first quarter, TSMC said in a statement.
However, the world’s largest contract chipmaker said its gross margin and operating margin forecasts in the quarter remain unchanged, as well as its full-year business outlook.
Photo: CNA
TSMC said the earthquake, along with several significant aftershocks throughout the Lunar New Year holiday, did not cause any structural damage to its fabs.
Water supply, power transmission, workplace safety systems and the company’s facility operations continue to function normally, it said.
However, a certain number of wafers in process were impacted and had to be scrapped due to the earthquake and aftershocks, TSMC said, without disclosing the exact numbers.
As the quake affected TSMC fabs at the Southern Taiwan Science Park (南部科學園區), which is a major site for producing advanced 3-nanometer and 5-nanometer process chips, the company experienced greater damage than the losses of NT$3 billion it incurred from the magnitude 7.2 earthquake on the Richter scale that struck in April last year.
TSMC yesterday said it expects revenue for the first quarter to be closer to the lower end of its US$25 billion to US$25.8 billion guidance made at an earnings conference on Jan. 16.
Its gross margin is forecast to stay unchanged at between 57 percent and 59 percent, and its operating margin remains between 46.5 percent and 48.5 percent, it said.
“The company is making every effort to recover the lost production, and there is no change to our full-year outlook,” TSMC said.
At last month’s earnings conference, TSMC projected revenue for this year to grow in the mid-20s compared with the year before, citing strong artificial intelligence (AI) and recovering non-AI demand, which would outpace the overall foundry industry’s 10 percent annual growth, it said.
TSMC’s remarks on the quake’s impact came as the company yesterday also reported that its consolidated revenue for last month reached NT$293.29 billion, an increase of 5.4 percent from the previous month and up 35.9 percent from a year earlier.
Last month’s revenue was the second-highest monthly sales in the company’s history, after the NT$314.24 billion it registered in October last year, TSMC data showed.
Shares in TSMC fell 1.78 percent in Taipei trading yesterday after its US depositary receipts fell 2.08 percent on Friday in New York, as the stock faces pressure from US President Donald Trump’s threats to slap tariffs on semiconductor imports.
The company is scheduled to hold a board meeting in Arizona this week, the first in TSMC’s 37-year history, and the market is speculating whether it would make any announcements to appease Trump.
Real estate agent and property developer JSL Construction & Development Co (愛山林) led the average compensation rankings among companies listed on the Taiwan Stock Exchange (TWSE) last year, while contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) finished 14th. JSL Construction paid its employees total average compensation of NT$4.78 million (US$159,701), down 13.5 percent from a year earlier, but still ahead of the most profitable listed tech giants, including TSMC, TWSE data showed. Last year, the average compensation (which includes salary, overtime, bonuses and allowances) paid by TSMC rose 21.6 percent to reach about NT$3.33 million, lifting its ranking by 10 notches
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