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TSMC to send positive signals in April investor conference: Analysts

04/04/2024 11:07 PM
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CNA file photo
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Taipei, April 4 (CNA) The world's biggest contract chipmaker, Taiwan Semiconductor Manufacturing Co. (TSMC), will hold its investor conference on April 18, and analysts said they expect the need for high-end chips driven by AI development will further boost TSMC's revenue.

Liu Pei-chen (劉佩真), a research fellow with the Taiwan Institute of Economic Research (TIER), said highlights of the upcoming TSMC investor conference would be the industry's prospects in general, TSMC's expected sales, how the industry supply chain has cleared inventories, and the AI-based demand for high-end chips.

In the investor conference held in mid-January, TSMC said it expected its sales would grow 21-26 percent from a year earlier in 2024, of which the demand from high performance computing platforms was expected to rise the most.

As demand from AI-based products has seen significant growth, the related contribution is expected to grow to the point of accounting for 17-19 percent of the total revenue in five years, according to the January event.

The January prediction saw a better outlook as TSMC said in the July investor conference in 2023 that the revenue from AI-driven products was about 6 percent of its revenue and is expected to be around 11 to 13 percent in five years.

An analyst from an investment institution said TSMC's 2024 second quarter revenue is expected to return to NT$600 billion (US$18.73 billion), seeing a sequential growth of 5-7 percent, with 3nm and 5nm process technology-based AI-related products to be the long-term driver behind the sales.

The company said in the January investor conference that it forecast its sales would range between NT$559.8 billion and NT$584.7 billion in the first quarter of the year.

Liu said she expects the April 18 event will focus on the chipmaker's technological progress, capacity expansion, and overseas subsidiaries, especially the one in Arizona, and whether it has secured U.S. government subsidy.

TSMC revealed in January that it has started mass producing chips with its N3E process technology, which is the enhanced 3nm process for better power, performance and density, in the fourth quarter last year, and it expected the revenue from the 3nm technology would grow threefold this year, reaching 14-16 percent of the total revenue.

The company also expected the 2nm technology will be used for mass production in 2025.

According to investment institutions, investors will be watching whether 2nm technology, with its higher cost, will discourage customers from buying 2nm chips for smartphones and personal computers.

Other points to be watched include whether the fab in Arizona, now expected to begin mass production of 4nm chips in the first half of 2025, would be able to do so ahead of schedule, and whether the subsidies promised by the U.S. and German governments would be in place, the institutions said.

The April investor conference is expected to release positive signals as the market of AI applications is speedily developing and smartphone and PC markets are also gradually rebounding, they added.

(By Chang Chien-chung and Alison Hsiao)


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