The largest contract producer of processor chips for various technologies, Taiwan Semiconductor Manufacturing Co. (TSMC), reported a 78% increase in quarterly profit over the same period last year but still predicted limited demand this year, as per AP’s report.
According to the company, revenue for the last quarter of 2022 increased 42.8% over the same period the previous year to 625.5 billion New Taiwan dollars ($20.6 billion).
TSMC’s profits in total were $9.7 billion or 295.9 billion New Taiwan dollars.
(Photo : SAM YEH/AFP via Getty Images)
A security staff stands next to a logo of the Taiwan Semiconductor Manufacturing Co, (TSMC), during the investors conference in Taipei on July 16, 2014. TSMC, the world’s biggest contract microchip maker, was to release second-quarter earnings results at an online conference.
(Photo : SAM YEH/AFP via Getty Images)
A security staff stands next to a logo of the Taiwan Semiconductor Manufacturing Co, (TSMC), during the investors conference in Taipei on July 16, 2014. TSMC, the world’s biggest contract microchip maker, was to release second-quarter earnings results at an online conference.
Larger Picture
Large tech companies such as Apple and Qualcomm purchase processor chips from TSMC, which has its headquarters in Hsinchu, Taiwan.
But the larger picture looms in the US-China tech war in which TSMC is caught in between since most of its chips are produced in Chinese factories.
Wendell Huang, the chief financial officer of TSMC, said that the fourth quarter’s sales were negatively impacted by “demand softness” due to weakening worldwide economies.
According to Huang, the business anticipates further sales declines in the first quarter of 2023.
Chipmakers profit from the demand for advanced computing, next-generation telecommunications, and processors for various fields.
In 2022, TSMC planned to spend $100 billion on production, research, and development for the next three years.
Taiwan, South Korea, and China produce most of the semiconductors used in cell phones, computers, and other technologies.
American authorities have expressed concerns about their reliance on supplies that could be affected by the crisis between China and Taiwan. They are pressuring TSMC and other chipmakers to build plants in the country.
Read also: Global Chip Shortage to Be Answered by Sony and TSMC’s New Plant in Japan? Would This Affect Relationship with Apple?
Arizona Plant
A TSMC semiconductor manufacturing facility currently under construction in Phoenix was visited by President Joe Biden last month.
TSMC announced it would increase its planned investment at the Arizona plant to $40 billion, which makes it one of the biggest foreign investments in the US.
The investment is a significant victory for Biden as he contends with supply chain issues amid the US-China tech war.
Mark Liu, the chairman of TSMC, said that once the two planned chip fabrication units operate, they will generate $10 billion in yearly revenue, and customers will sell $40 billion worth of goods using those chips.
The first semiconductor facility that TSMC aims to construct will be in Japan. The chipmaker and Sony Corp. later announced their joint $7 billion investment in the plant.
Additionally, TSMC runs design centers in San Jose, California, and Austin, Texas, as well as a chip plant in Camas, Washington.
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