[ Mobile China News] Recently, TSMC released its third quarter financial report for 2022 and stated that its overall revenue exceeded expectations, but there are also signs that the semiconductor industry will usher in a cold winter in the future.
Based on TSMC's third-quarter financial report, we can see that the company's total revenue is US$20.2 billion, a year-on-year increase of 35.9% and a month-on-month increase of 11.4%. The gross profit margin reached 60.4%, and the operating profit margin reached 50.6%. In the securities market, TSMC's stock price surged and stabilized in the U.S. market. rose by more than 9% at one point, and finally closed at US$66.62, an increase of 3.92%. However, in the past five trading days, TSMC's stock price was halved, with its market value falling from its high of US$750 billion at the beginning of the year to US$345.5 billion, evaporating nearly 54%. Goldman Sachs released a research report today, reiterating TSMC's "buy" rating, but excluding the "confidence buy" list, the target price dropped from $126 to $89 to reflect the weakening profit outlook and the rising uncertainty of demand.
TSMC released its third quarter financial report (picture source from the Internet)
In addition, we can also see in the financial report that in the third quarter, the company's smartphone business revenue accounted for 41%, a month-on-month increase of 25%, high-performance computer revenue accounted for 39%, and a quarter-on-quarter increase of 4%, respectively, accounting for the leading TSMC's revenue. In addition, the revenue of the Internet of Things business increased by 33% to 10%. The biggest contributor to smartphone revenue in the third quarter was Apple , with North American customers accounting for 72% of total revenue, up from 64% in the second quarter, and revenue from mainland China accounting for 8%, down from 13% in the previous quarter.
Although Apple previously delayed the OEM order for TSMC's 3nm process product N3 due to process problems such as cost and power consumption and switched to N3E, the stock of 5nm process has been added. Industry insiders said that this further enhances TSMC's share and profitability in advanced process chips. It can be seen from the third quarter financial report data that advanced technology nodes (7nm and above) account for 54% of TSMC's total revenue. Of these, 5 nanometers contributed the largest revenue (28%), followed by 7 nanometers (26%).
Since Apple's new products have adopted a 5nm process this year, it is expected that the overall proportion of 3nm mass-produced by the end of the year will remain low. In this regard, TSMC pointed out that customer demand exceeds the company's supply capacity, partly due to the ongoing machine delivery problems. It is expected that 3nm will reach full utilization by 2023. At present, the progress of N3E technology development is ahead of schedule and is expected to be mass-produced in the second half of 2023. Compared with N5, N3 is expected to contribute higher revenue in 2023.
Due to the lag of the semiconductor supply chain, TSMC expects the decline in utilization of 7nm and 6nm to continue into the first half of 2023. At the same time, TSMC said that the market demand for 7nm and 6nm tends to be more cyclical than structural phenomena, and it is expected that the demand for 7nm and 6nm will rebound in the second half of 2023. Wei Zhejia said, "The expansion plan of Nanjing factory production is also carried out according to the plan. Although the demand for 7 nanometers has slowed down, the construction of the Kaohsiung factory is also carried out according to the progress. The Japanese factory is also carried out according to the progress, meeting customer needs." According to reports, TSMC's factory progress in Arizona, USA is currently "in line with expectations."
But it is worth noting that TSMC has observed a weakening demand in the consumer terminal market. Based on fourth-quarter revenue expectations, TSMC said it would lower its capital expenditures from the original estimate of $40 billion to $36 billion. In July this year, this budget figure was still US$44 billion. At present, the downstream market is sluggish, which limits the shipment and performance of upstream manufacturers. PC hardware such as CPU, graphics card , etc. are all subject to demand restrictions from downstream. The slow demand for upgrade and replacement has caused upstream manufacturers to have inventory backlogs. In addition, the gradual extension of PC-related component replacement cycle has further tightened the upstream market shipment scale, and supply chain adjustments have reduced processor shipments. Chai Daixuan, director of
CIC consulting, said that since the outbreak of the epidemic, the field of e-commerce procurement of enterprises has been continuously expanding, and has expanded from the initial procurement of general-purpose materials for corporate consumption to the fields of professional and customized products and means of production; from the initial focus on product procurement, it has expanded to the field of enterprise service procurement, thus driving the large customer market to gradually tilt towards e-commerce procurement. "The trend of e-commerce in large customers may bring a new round of demand stimulus to the PC market."
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