TSMC reports highest net profit for Q2

Taipei, July 18 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC) on Thursday reported its highest-ever second-quarter net profit, attributing the record results to solid demand for emerging technologies such as high-performance computing (HPC) devices.

In a statement released after the local stock market closed, TSMC, the world's largest contract chipmaker, said it posted NT$247.85 billion (US$7.60 billion) in net profit in the April-June period, up 36.3 percent from a year earlier and also up 9.9 percent from a quarter earlier.

Its earnings per share for the second quarter stood at NT$9.56, compared with NT$7.01 a year earlier and NT$8.70 a quarter earlier, TSMC said.

According to the chipmaker, the solid bottom line came after TSMC generated US$20.82 billion in consolidated sales, beating the company's previous estimate between US$19.6 billion and US$20.4 billion.

Benefiting from an improving cost structure and a lower-than-expected rate of the Taiwan dollar against the U.S. dollar, TSMC said its gross margin -- the difference between revenue and the cost of goods sold -- for the second quarter stood at 53.2 percent, going beyond the earlier forecast of 51-53 percent, and up 0.1 percentage points from a quarter earlier.

Its operating margin -- the difference between sales, the cost of goods sold and operating expenses -- for the second quarter also beat an earlier forecast of 40-42 percent to hit 42.5 percent, up 0.5 percentage points from a quarter earlier, TSMC said.

TSMC made its second-quarter guidance using a Taiwan dollar exchange rate of NT$32.30 against the U.S. dollar, compared with the average exchange rate of NT$32.35 in the quarter.

Sales of its HPC division rose 28 percent from a quarter earlier in the second quarter, while revenue generated by its consumer electronics, Internet of Things and automotive electronics platforms rose 20 percent, 6 percent and 5 percent, respectively.

Bucking the upturn, sales posted by its smartphone platform fell 1 percent from a quarter earlier in the April-June period, according to TSMC.

In the second quarter, the advanced 3 nanometer process, the latest technology TSMC has started mass production of, accounted for 15 percent of the chipmaker's total sales with the 5nm and 7nm processes making up 35 percent and 17 percent, respectively.

Sales of TSMC's 3nm, 5nm and 7nm chips accounted for 67 percent of its total sales in the second quarter.

In the first half of this year, TSMC's net profit rose 21.7 percent from a year earlier to NT$473.33 billion with EPS at NT$18.25.

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