TSMC's Q2 net profit smashes records; gross margin beats estimates

07/14/2022 04:26 PM
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Taipei, July 14 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest pure play wafer manufacturer, on Thursday reported a record high net profit for the second quarter, while its gross margin climbed higher to beat its previous estimates.

In a statement released after the local stock market closed, TSMC said its net profit for the April-June period was NT$237.03 billion (US$7.93 billion), up 16.9 percent from the previous quarter and 76.4 percent from a year earlier.

The company reported a quarterly record NT$9.14 in earnings per share for the second quarter, compared with NT$7.82 in the first quarter and NT$5.18 a year earlier.

Its second-quarter gross margin -- the difference between revenue and the cost of goods sold -- exceeded its most recent guidance of between 56.0 percent and 58.0 percent, rising to 59.1 percent, from 55.6 percent in the first quarter and 50.0 percent a year earlier.

TSMC's consolidated sales also beat its estimate, totaling US$18.16 billion in the second quarter. In Taiwan dollar terms, the company's second-quarter consolidated sales rose 8.8 percent from a quarter earlier to NT$534.14 billion. In its guidance in April, TSMC had estimated the figure at between US$17.6 billion and US$18.2 billion.

Mega International Investment Services Corp. analyst Alex Huang said one of the factors that contributed to TSMC's higher than expected second-quarter results was a weaker Taiwan dollar, which gave the chipmaker an edge in the global market.

Huang added TSMC also benefited from its improving product mix, which gave more weight to its high-end processes.

Chips on the 7 nanometer process accounted for 30 percent of TSMC's total sales in the second quarter, while its latest commercial technology, its 5nm chips, made up 21 percent.

Its 5nm and 7nm chips together accounted for 51 percent of its total revenue in the second quarter, compared with 50 percent in the first quarter.

According to TSMC, second-quarter sales generated from its Internet of Things and automotive electronics operations rose 14 percent from a quarter earlier, and revenue from its high performance computing device division grew 13 percent.

TSMC's second-quarter sales from its consumer electronics device operations and smartphone division rose 5 percent and 3 percent, respectively, from a quarter earlier, it reported.

In the first six months of the year, TSMC's net profit soared 60.5 percent from a year earlier to NT$439.76 billion, with an EPS of NT$16.96, while its gross margin was up 6.2 percentage points from a year earlier at 57.4 percent, the company's data showed.

(By Chang Chien-chung and Frances Huang)

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