TSMC has disclosed that its third-quarter revenue and margins surpassed the guidance it provided three months ago. The pure-play foundry anticipates a 13% sequential increase in revenue in US dollar terms at the midpoint for the fourth quarter.
TSMC expects to post revenue of between US$26.1 billion and US$26.9 billion in the fourth quarter of 2024, indicating a 35% year-on-year surge at the midpoint. Gross margin and operating margin for the quarter are estimated at 57-59% and 46.5-48.5%, respectively.
TSMC reported net revenue climbed 39% year-on-year to NT$759.69 billion for the third quarter of 2024. The revenue in US dollar terms increased by 12.9% sequentially and by 36% from the previous year, reaching US$23.5 billion. The sales figures exceeded the guidance range of US$22.4 billion to US$23.2 billion.
TSMC's gross margin came to 57.8% in the third quarter of 2024, up 4.6% sequentially, primarily thanks to a higher capacity utilization rate and cost improvement efforts. Given a higher gross margin, operating margin improved 5.0% sequentially to 47.5%. Both margins topped the upper limit of guidance.
TSMC reported net earnings of NT$325.26 billion in the third quarter of 2024, representing a 31.2% increase from the second quarter and a 54.2% rise from the third quarter of 2023. The net profit margin was 42.8%, and the diluted EPS was NT$12.54.
Strong 3nm and 5nm chip demand
TSMC's revenue increased 12.8% quarter-on-quarter in the third quarter, driven by strong smartphone and AI demand for both 3nm and 5nm technologies. By technology, 3nm process technology accounted for 20% of total wafer revenue in the third quarter, up from 15% in the previous quarter and 6% in the third quarter of 2023.
Advanced technologies (7nm and below) generated 69% of TSMC's overall wafer revenue in the third quarter of 2024.
By platform, HPC and Smartphone represented 51% and 34% of net revenue respectively, while IoT, Automotive, DCE, and Others each represented 7%, 5%, 1%, and 2%, according to TSMC. The HPC segment climbed from 42% as a proportion of revenue during the same period in 2023.
TSMC indicated that third-quarter revenue from HPC, Smartphones, IoT, Automotive, and Others increased 11%, 16%, 35%, 6%, and 8% respectively, quarter-on-quarter, while DCE decreased 19%.
In the third quarter of 2024, revenue from customers based in North America accounted for 71% of TSMC's total net revenue from a geographic perspective. Revenue from China, Asia Pacific, Japan, and EMEA (Europe, Middle East, and Africa) accounted for 11%, 10%, 5%, and 3% of total net revenue, respectively.
TSMC also disclosed that its days of inventory increased four days to 87 days in the third quarter, primarily due to N3 and N5 wafer prebuild.
In addition, TSMC further narrowed its capex outlook for 2024 to slightly exceed US$30 billion. The foundry had previously revised its capex forecast range from US$28-32 billion to US$30-32 billion.
Source: Compiled by DIGITIMES
Source: Compiled by DIGITIMES
