TSMC sales hit high in 2021 after record revenue in December

Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, announced record sales for 2021 Monday after smashing monthly revenue records in December.

Analysts attributed the growth to strong demand for TSMC's advanced 5-nanometer process, the latest technology the chipmaker has begun to mass-produce. Demand is being driven largely by emerging sectors such as 5G applications, high-performance computing devices, and automotive electronics.

In a statement, TSMC said it posted NT$1.59 trillion in consolidated sales, up 18.5 percent from a year earlier.

In December, TSMC's consolidated sales stood at NT$155.38 billion, up 4.8 percent from a month earlier and also up 32.4 percent from a year earlier. The month-on-month increase was evidence that TSMC remained unencumbered by the effects of the semiconductor industry's traditional slow season in the fourth quarter.

After a strong showing in December, TSMC's consolidated sales for the fourth quarter also hit a new quarterly high of NT$438.19 billion, up 5.67 percent from a quarter earlier and up 21.2 percent over the same quarter last year.

At its last investor conference held in mid-October, TSMC forecast consolidated sales of between US$154 billion and US$157 billion, and after the guidance was converted into Taiwan dollar terms, the revenue would range between NT$431.2 billion and NT$439.6 billion, up 4-6 percent from a quarter earlier.

The fourth-quarter revenue total was in line with TSMC's forecast and even stood at the higher end of the estimate.

TSMC has scheduled an investor conference for Thursday to detail its fourth-quarter results and give guidance for the first quarter of 2022 and the rest of the year.

Many investors have high hopes that TSMC will give positive leads in the meeting, with expectations that the chipmaker will announce a capital expenditure budget of more than US$40 billion for 2022 to expand its production capacity and upgrade its technologies to maintain its advantage over its peers.

A U.S. brokerage said in a recent research note that TSMC could enjoy a 26.1 percent increase in sales from a year earlier in U.S. dollar terms in 2022, and its earnings per share could hit NT$29-30 per share.

For the first quarter, the brokerage also forecast a 3.7 percent sequential increase in consolidated sales as TSMC continued to leave the effects of the slow season behind.

The U.S.-based brokerage has raised its target price for the stock to NT$1,035.00 from NT$1,028.00 and left its "buy" recommendation unchanged.

The Chinese-language Economic Daily News reported on Monday that several international tech giants such as Apple Inc., NVidia Inc., Qualcomm Inc., and Advanced Micro Devices Inc. have paid deposits with TSMC in a bid to secure production capacity, as an international chip supply shortage continues to have reverberations.

TSMC released the latest sales report after the equity market closed. TSMC shares closed up 1.42 percent to end at NT$643.00, recouping the stock's earlier losses and served as an anchor to stabilize the main board, which came off an earlier low to close up 0.38 percent.

Source: Focus Taiwan News Channel