TSMC Q4 profit falls 19% but beats estimates; Sees support from AI demand
Investing.com-- Taiwan Semiconductor Manufacturing Co (TW:2330) (NYSE:TSM) logged a smaller-than-expected decline in its fourth-quarter profit as revenue was buoyed by increased sales of its most advanced chips.
The world’s largest contract chipmaker forecast slightly weaker performance in the first quarter of 2024, but said that chip demand in the coming year will be supported by strong demand for artificial intelligence.
«We expect 2024 to be a healthy growth year for TSMC, supported by… robust AI-related demand. AI models need to be supported by more powerful semiconductor hardware… thus the value of TSMC's technology position is increasing,» CEO C.C. Wei said in a post-earnings call.
Profit for the three months to December 31 fell to T$238.7 billion ($7.6 billion) from T$295.9 billion a year ago. On a per-share basis, profit fell to T$9.21, but still beat Investing.com estimates of T$8.67.
Revenue was T$625.5 billion ($20 billion), remaining largely unchanged from the prior year, but beating estimates for a reading of T$617.24 billion. The figure was also above TSMC’s forecast for the year.
Revenue improved from the prior quarter on improved demand for its 3 nanometer chips, which TSMC describes as the industry’s most advanced semiconductor technology.
TSMC said it expects sales in the first quarter to range between $18 billion and $18.8 billion, with a gross margin of 52% to 54%. Its gross margin for the fourth quarter was 53%.
The firm also forecast slightly higher capital expenditure for 2024, between $28 billion to $32 billion, compared to about $30.1 billion in 2023. A bulk of this expenditure will be dedicated towards high-computing chips, CEO Wei said.
Demand for high-performance computing chips improved in
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