Chipmaker TSMC’s shares jump after quarterly profit beats estimates
TAIPEI (Reuters) -TSMC shares jumped 3.7% on Friday outperforming the broader market, after the Taiwanese chipmaker introduced forecast-beating second-quarter revenue, with analysts buoyant on the agency’s outlook regardless of some draw back concern.
Taiwan Semiconductor Manufacturing Co Ltd (TSMC), a significant Apple Inc provider and the world’s largest contract chipmaker, posted on Thursday a 76.4% leap in revenue for the April-June interval of 2022, to T$237.0 billion ($7.92 billion).
It stated it was “extremely assured” about its long-term prospects, although additionally signalled cooling demand from client electronics prospects who it expects to scale back chip stockpiles over the subsequent few quarters into 2023.
The market has been cautious of a doable chip glut as a consequence of slowing client demand and hovering inflation, particularly after Micron Expertise Inc final month stated a chip scarcity in some sectors was rapidly turning right into a glut.
TSMC’s earnings are more likely to ease a few of these worries for now.
Analysts at J.P. Morgan stated TSMC acknowledging the downturn was a “constructive begin”, anticipating the chipmaker’s inventory value to maneuver up modestly within the close to time period.
“However affirmation of downturn from different semi firms on this earnings season is important for a definitive clearing occasion.”
TSMC’s shares are nonetheless down round 20% to date this yr, according to broader native market, as buyers fear Taiwan’s export-dependent financial system will probably be hit by inflation and slowing client demand in China, the US and Europe.
Morningstar analysts stated they believed Qualcomm Inc and Nvidia Corp’s elevated allocation to TSMC would have cushioned the affect of a lot of the total softened demand for the subsequent 12 months.
“We observe that the duo has contracted TSMC as their major foundry (if not sole) for many of 2023’s client merchandise due to low manufacturing yields at Samsung” Electronics Co Ltd.
Taiwan’s benchmark index closed up 0.8% on Friday.
($1 = 29.9410 Taiwan {dollars})
(Reporting by Yimou Lee and Ben Blanchard; Modifying by Jacqueline Wong and Christopher Cushing)
