TSMC’s Q2 2022 Financial Report – Hits All-Time Record in Net Income

TSMC’s Q2 2022 Financial Report – Hits All-Time Record in Net Income

TSMC’s Q2 2022 Financial Report – Hits All-Time Record in Net Income

News unit EMGblog.com: The Taiwanese company TSMC, the world’s largest independent chipmaker, On July 14 of this year (July 23, 1401), it presented its financial report for the quarter ending June 30, 2022 Published. According to this report, the company’s total revenue in the past quarter was 534.14 billion New Taiwan dollars, equivalent to 18.16 billion US dollars; The figure is about 10 billion dollars more than the estimate of 524.02 billion Taiwan dollars by the analysts of Refinitiv Institute and indicates an annual growth of 43.5%. Compared to the same period of last year, the net income of this company has grown by 76.4% and by registering a historical record, it has reached the number beyond the expectation of 237.03 billion new Taiwan dollars (about 7.98 billion US dollars).

In recent months and years, the global corona epidemic has led There is a global shortage of chips, and component factories are facing a shortage of experienced workers. In addition, the high and surprising volume of demand for new cars has also increased the need for advanced electronic circuits in an unprecedented way. As Tim Cook, the CEO of Apple, estimated that the chip shortage situation in the year Last year, it caused a loss of six billion dollars to this company. Interestingly, the current shortage has made it difficult to supply older chips, known as legacy, rather than affecting new and advanced chips; Chips that are used in other sectors such as display and device power.

At the same time, TSMC has surprisingly recently announced that the company’s chip inventory has decreased due to the decrease in demand for personal computers, smartphones. and other consumer products are more than needed. From the point of view of C. C. He (C. C. Wei), CEO of the company, the current situation is just one of the natural cycles of the semiconductor market and the problems can be overcome by reducing the inventory. He further added that until the first half of 2023, several consecutive seasons will be devoted to the adjustment of the chip inventory in the market. According to him, the rebalancing of the chip industry will take several seasons, and suppliers are facing major challenges in supply chains, which have significantly increased the delivery time of advanced and mature nodes. At the same time, C. C. He is optimistic about the long-term prospects of market demand for chips and believes that despite the short-term macroeconomic crises that have brought uncertainties, the path of structural and fundamental growth of demand for semiconductor products will continue.

According to TSMC announcement, in In the second quarter of this year, the supply of 5nm chips accounted for 21% of the total revenue of the Taiwanese company’s chip division, and 7nm products also brought 30% of revenue to this company. In addition, 51% of the total revenue of the chip segment was derived from the performance of 7nm and more advanced technologies. Also, the gross profit of the company in the quarter ending June 30 of this year was 59.1% and the operating profit margin was 49.1%.

Wendell Huang, vice president and chief financial officer of TSMC, referring to the company’s current situation, said: “Our business in the second quarter was driven by demand growth in high-performance computing (HPC), Internet of Things and Demand related to cars was supported. We expect our business to be strengthened in Q3 2022 by continued demand for advanced 5nm and 7nm technologies.”

TSMC’s financial results show overall favorable results and a bright outlook for the industry, but the minimal spending style reflects the cautious path chipmakers are taking at a time when concerns about price increases and their impact are at peak. They have taken advantage of consumer demand as well as the high supply of chips.

TSMC’s report shows that although the company experienced a downward trend in the market for consumer products, such as smartphones and personal computers, its business related to data centers and parts used in the automotive industry. The path of growth has been maintained. However, the investors of the Taiwanese company are worried about the possible saturation of the chip in the market; Because the current level of inventory of these products is very high and despite the weak demand, it may have a negative impact on the price of semiconductors.

Of course, during the last six months, luck has not been very kind to TSMC investors and the price of each share of the company has decreased by 36.02% equivalent to $48.20 to $85.63 during this period. But with TSMC’s long list of top-tier customers including Apple, MediaTek and Qualcomm, this The reputable company will not face serious economic problems at least in the short term.

The amount of chip inventory this year has decreased due to several concerns such as disruption of the supply chain, Russia’s military invasion of Ukraine and the increase in the cost of raw materials. As last month, the American chipmaker Micron warned of a decline in demand for consumer products. However, TSMC’s financial results have allayed some of those concerns, particularly about the company’s own performance. According to Sze Ho Ng, a market analyst at China Renaissance Institute, TSMC’s financial performance report shows that the company will continue to grow even in the face of a downturn in the global chip market.

The managers of TSMC, which is the most important supplier of Apple’s chips, expect the company’s next quarter’s revenue to increase from the revenue of 14.8 billion dollars in the third quarter of last year and reach a figure of around 19.8 to 20.6 billion dollars. It is also estimated that considering every 1 US dollar is equivalent to 29.7 new Taiwan dollars, the gross profit margin of the company in the next quarter will be between 57.5 and 59.5 percent and the operating profit margin will be between 47 and 49 percent.

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