TSMC's November sales down from previous month/year

Taipei, Dec. 8 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, reported Friday that its sales for November were down from October and November 2022 but were still the second highest for any month in 2023.

In a statement, TSMC said it had consolidated sales of NT$206.03 billion (US$6.56 billion) in November, down 15.3 percent from a month earlier and also down 7.5 percent from the same month a year earlier.

The November figure was the second highest for any month this year, trailing only the NT$243.20 billion in consolidated sales in October, a record high for any single month in TSMC history.

Analysts said TSMC continued to benefit from its advanced 3 nanometer process, a technology produced commercially since the end of last year, while the month-on-month decline largely reflected a relatively high base of comparison in October.

The year-on-year decline, analysts said, was due to the adverse effect of weakening demand for chips made on mature processes amid global semiconductor inventory adjustments, which was only partially offset by higher demand for TSMC's sophisticated processes.

At an investor conference held on Oct. 19, TSMC CEO C.C. Wei (魏哲家) said strong demand for the 3nm process is expected to continue into 2024.

In the third quarter, the 3-nanometer process accounted for 6 percent of the company's total sales, the 5nm process made up 37 percent, and the 7nm process represented 16 percent, meaning that advanced technologies accounted for 59 percent of total revenue.

In the first 11 months of 2023, TSMC's consolidated sales were down 4.1 percent from a year earlier to NT$1.99 trillion, the latest sign of weakness in demand in the global semiconductor market this year.

Due to solid demand for its 3nm process, TSMC estimated at its October investor conference that its sales in the fourth quarter would range between US$18.8 billion and US$19.6 billion.

The median figure of US$19.2 billion would represent an 11.1 percent increase in sales from the third quarter.

Based on an exchange rate of NT$32 to one U.S. dollar, TSMC's estimate of sales for the quarter in Taiwan dollar terms was between NT$601.6 and NT$627.2 billion.

In October and November, TSMC had combined sales of NT$449.23 billion, and an analyst said it should not be hard for the company to reach its target for the quarter in December given that it only needs sales of NT$152.4 billion to get there.

Wei said at a 2023 supply chain management forum in Hsinchu on Thursday that he was upbeat about artificial intelligence development, which is expected to create major opportunities in 2024, even if high inflation worldwide continues to hold back the global economy.

The semiconductor industry is a critical part of AI development as AI applications need high computing performance, and AI device developers need to cut energy consumption and boost efficiency by using ever more powerful chips, he said.

Given those trends, Wei said, TSMC will continue to work on upgrading its technologies and work closely with its suppliers to meet industrial needs in the current fast changing market.

TSMC is currently developing a 2nm process, which is scheduled to start commercial production in 2025, to further cement the chipmaker's lead over its peers.