The world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co (NYSE: TSM), announced an 11.2 percent increase in second-quarter profit, boosted by robust demand for semiconductors from the personal computer, smartphone, and vehicle industries.
What happened was this: The Taiwanese firm, whose customers include chipmaker Nvidia Corp (NASDAQ: NVDA) and Qualcomm Inc (NASDAQ: QCOM), reported a 19.8% increase in net sales to a new high of $13.34 billion.
For the three months ending June, the Apple Inc (NASDAQ: AAPL) supplier recorded a profit of T$134.4 billion ($4.81 billion).
TSMC expects revenue in the current quarter to be in the range of $14.6 billion to $14.9 billion, up from $12.1 billion a year earlier.
Also see: Supplier of Apples TSMC’s Q1 Profit Increases 19% Due to Chip Shortage
“Continued growth in HPC and Automotive-related demand drove our second quarter business,” said Wendell Huang, TSMC’s chief financial officer.
“We expect robust demand for our industry-leading 5nm and 7nm technologies to underpin our business in the third quarter of 2021, driven by all four growth platforms, which are smartphone, HPC, IoT, and Automotive-related applications.”
Shipments of 5-nanometer chips accounted for 18% of overall wafer revenue in the second quarter, while 7-nanometer chips accounted for 31%. Advanced technologies, defined as technologies with a 7-nanometer or higher resolution, accounted for 49% of total wafer revenue.
Why Does It Matter? As automakers, smartphone manufacturers, and appliance manufacturers struggle to obtain supplies, demand has risen. In addition, the pandemic has increased demand for work-at-home and learn-at-home gadgets.
TSMC announced in April that it aims to invest $100 billion over the next three years to enhance its chip fabrication capacity in order to meet the expected rise in demand for fifth-generation (5G) technology.
On Wednesday, TSMC’s stock finished 0.4 percent higher at $124.39.
Continue reading: According to Cramer, Apple and these stocks are the best bets for a rebound in consumer spending.
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