October 13th news, TSMC, the leader in wafer foundry, held a legal meeting today and announced its third-quarter financial report. Both revenue and profits maintained double-digit growth month-on-month, exceeding analysts' expectations. Against the background of the current decline in the global semiconductor market, TSMC's outstanding profitability as a leading company in the semiconductor industry is highlighted. However, in order to deal with the downward cycle of semiconductor , TSMC has also downgraded its capital expenditure in 2022.
Specifically, in the third quarter of 2022, TSMC's revenue was NT$4 613.14 billion, a month-on-month increase of 14.8% from the second quarter and a year-on-year increase of 47.9% from the same period in 2021; its net profit increased by 18.5% from the previous month and soared by 79.7% from the same period of , and also increased to NT$280.9 billion (approximately US$8.8 billion), higher than the average estimate of NT$264.66 billion by industry analysts; EPS per share reached NT$10.83, better than previous expectations; gross profit margin in the third quarter was 60.4% and also higher than the estimated 58.9%; operating profit rate was 50.6%, and net profit margin was 45.8%, which was also higher than expected.
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cumulative revenue in the first three quarters of 2022 reached NT$1638.359 billion, an increase of 42.6% over the same period in 2021. EPS per share reached NT$27.79. EPS per share in the first three quarters of 2022 has surpassed the results of the whole year in 2021.
In terms of the proportion of wafer sales of each process node in total revenue, the revenue of 5nm in the third quarter accounted for 28%, an increase of 7 percentage points from 21% in the second quarter; the revenue of 7nm accounted for 26%, a decrease of 4 percentage points from 30% in the second quarter. The revenue share of the entire advanced process node below 7nm reached 54%. 16nm revenue accounts for 12%, while 28nm revenue accounts for 10%.
TSMC Vice President and Chief Financial Officer Huang Renzhao also said: "The strong demand for TSMC's industry-leading 5nm process technology has provided support for our business in the third quarter."
Judging from the revenue contribution of the final product application field, the sales of high-performance computing (HPC) chips in the third quarter increased by 4% compared with the second quarter. The revenue accounted for 39%, but it fell by 4 percentage points compared with 43% in the second quarter; the sales of smartphone chips increased by 25% compared with the second quarter, and the revenue accounted for 41%, and the revenue accounted for 38% in the second quarter; the revenue of the automotive chip business increased by 15% compared with the second quarter, and the revenue accounted for 5%, the same as the second quarter; the Internet of Things chip business also performed strongly, with revenue increasing by 33% month-on-month, and the revenue accounted for 10%, and the revenue accounted for 2 percentage points compared with the second quarter.
Obviously, the demand for A15 and 16 chips of Apple's iPhone 14 series has brought great help to TSMC's smartphone chip business and the growth of 5nm process proportion, and has also made TSMC's mobile phone chip business account for the highest revenue share among all categories.
Looking ahead, Huang Renzhao said that in the fourth quarter of 2022, the market demand for TSMC's industry-leading 5nm process continued to increase, thus balancing the impact of weakening terminal market demand and the continued inventory adjustment of customers. TSMC's performance is expected to be flat.
For the fourth quarter's performance estimate, revenue is expected to be between US$19.9 billion and US$20.7 billion if calculated in US$19.9 billion. Based on the exchange rate of 1 USD to NT$31.5, the revenue amount will be between NT$626.85 billion and NT$652.05 billion, the gross profit margin is between 59.5% and 61.5%, and the operating profit rate is between 49% and 51%.
In addition, in response to the capital expenditure issues that the market is concerned about, Huang Renzhao said that he will further downgrade the capital expenditure in 2022 to US$36 billion, which is also the capital expenditure for TSMC to downgrade the capital expenditure to nearly US$40 billion three months ago. Compared with the amount of US$44 billion capital expenditure proposed at the beginning of 2022, the downward revision is more than 18%.
As for the reasons for downgrading capital expenditure, Huang Renzhao explained that it was mainly due to the recent adjustment of semiconductor inventory that exceeded expectations, coupled with the continued variables such as inflation , the Russian-Ukrainian conflict, interest rate hikes, and other situations that customers delayed their expansion plans.
Regarding the capital expenditure situation in 2023, Huang Renzhao emphasized that the current estimate is still too early and is expected to be announced in January 2023.
Editor: Xinzhixun-Longkejian
