Currently, TSMC's advanced process capacity utilization rate below 7 nanometers is still as high as 90%, while mature processes such as 22/28 nanometers have always been in short supply. IT House learned that TSMC released its July 2022 revenue report on August 10.

IT House reported on August 17 that according to Taiwan Electronic Times today, demand for consumer electronics such as PCs, mobile phones and TVs has dropped significantly since the beginning of this year, resulting in a large amount of inventory accumulating throughout the supply chain. Therefore, many manufacturers began to cut orders from upstream suppliers until it affected the wafer foundry industry.

Some IC design industry insiders said that although the upstream and downstream supply chains have recently released a lot of inventory, the worst situation has not yet happened, and it is still relatively difficult for manufacturers to reorganize and recover. The person said that is expected to continue to shrink wafer foundry orders in the fourth quarter due to customers delaying shipments and cutting orders. And the order cuts will mainly target wafer foundries with non-long-term cooperation, such as GlobalFoundries (GF), Power Semiconductor, etc.

The IC design industry said that in the second half of 2021, many upstream manufacturers believed that the market was in short supply until the end of 2023. In order to ensure the supply of goods, these upstream manufacturers booked a large number of orders. However, market demand suddenly dropped sharply, causing upstream manufacturers to accumulate a large amount of inventory in the second quarter of this year. In order to alleviate inventory, these manufacturers began to renegotiate order quantities with wafer foundries, and even directly defaulted on contracts.

In addition, this order cutting did not affect TSMC. This is mainly because many upstream manufacturers are worried that it will be difficult to obtain TSMC OEMs after cutting off TSMC’s orders. At present, the production capacity utilization rate of TSMC's advanced processes below 7 nanometers is still as high as 90%, while mature processes such as 22/28 nanometers have always been in short supply.

IT House learned that TSMC released its July 2022 revenue report on August 10. The report shows that TSMC’s consolidated revenue in July was approximately NT$186.763 billion (approximately NT$42.022 billion), an increase of 6.2% month-on-month, setting another record high. In addition, TSMC estimates third-quarter consolidated revenue to be between US$19.8 and US$20.6 billion.