TAIPEI: Taiwan Semiconductor Manufacturing Co Ltd (TSMC) on yesterday said it is doing all it can to increase productivity and alleviate a worldwide chip shortage, but that tight supplies will likely continue into next year.
The worldâs biggest contract chipmaker, at an earnings briefing, said it is expanding capacity and working to keep pricing reasonable.
The comments come after the Taiwanese firm reported a 19.4% rise in first-quarter profit, beating market expectations, on strong chip demand amid a global shift to home working.
TSMC, whose clients include Apple Inc and Qualcomm Inc, had already flagged âmultiple years of growth opportunitiesâ as the Covid-19 pandemic fuelled demand for advanced chips to power devices such as smartphones and laptops.
Its business was boosted by the chip shortage that initially forced automakers to cut production, but is now also hurting manufacturers of smartphones, laptops and even appliances. Yesterday, TSMC said it expects the chip shortage for its auto clients to be greatly reduced from the next quarter.
âOur first-quarter business was supported by HPC-related demand, balanced by a milder smartphone seasonality than in recent years,â said vice-president and CFO Wendell Huang, referring to high performance chips.
âMoving into second quarter 2021, we expect our revenue to be flattish, as HPC-related demand will continue to grow, offset by smartphone seasonality.â
TSMCâs net profit for January-March hit T$139.7 billion (RM20.3 billion), versus the T$134.01 billion average of 22 analyst estimates compiled by Refinitiv.
Revenue rose 25.4% to a record US$12.92 billion, in line with the companyâs earlier estimated range of US$12.7 billion to US$13 billion.
The firm forecast second-quarter revenue would be in a range of US$12.9 billion to US$13.2 billion, compared with US$10.38 billion in the same period a year earlier. It also lifted its revenue growth forecast for 2021 to about 20%, versus an earlier forecast of a mid-teens percentage.
TSMC said this month it plans to invest US$100 billion over the next three years to increase capacity at its plants.
The Taiwanese company yesterday lifted capital spending on the production and development of advanced chips to about US$30 billion this year, up from a range of US$25 billion to US$28 billion it forecast in January.
Analysts are bullish about the companyâs massive expansion plan, expecting global demand for advanced chips to surge as fifth-generation telecommunications (5G) technology and artificial intelligence applications are adopted more widely. â Reuters
