2024-05-06 02:23:42 ET
Summary
- In 1Q 2024, cutting-edge technologies made up 65% of the company’s total revenue (-2 pp q/q).
- In terms of revenue breakdown by platform, there was weak demand in the smartphones segment (due to seasonality), which was offset by strong demand in the HPC segment.
- TSMC received a grant of up to $6.6 billion from the US government under the CHIPS Act.
- TSMC's revenue forecast for the smartphone segment has been lowered, but the outlook for the HPC segment remains strong. The rating is Hold.
Investment thesis
We have covered Taiwan Semiconductor Manufacturing Company Limited (TSM) before, and as we expected, our revenue distribution expectations were met, with the percentage of HPC revenue exceeding the percentage of smartphone revenue. This was not only due to the increased demand for advanced chips from the HPC segment, but also due to a seasonal decline in smartphone shipments in Q1 2024....
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Taiwan Semiconductor: Solid HPC Revenue, Partially Offset By Smartphone Seasonality (Downgrade)