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Investing.com– Taiwan Semiconductor Manufacturing Corp (TW:) (NYSE:), or TSMC, clocked a stronger-than-expected first-quarter revenue on Wednesday because the world’s largest contract chipmaker benefited stronger demand on the again of synthetic intelligence growth.
TSMC’s web revenue rose to T$225.49 billion for the three months to March 31, larger than Reuters estimates of T$218.1 billion ($6.7 billion). The determine was additionally effectively above final yr’s web revenue of T$206.99 billion.
Diluted Q1 earnings per share have been T$8.70 or $1.38 per American Depository Receipt, up from $1.31 final yr.
However web revenue fell 5.5% on a quarterly foundation, signaling that demand might have cooled barely from highs in 2023.
TSMC was additionally endeavor elevated prices to fund elevated chip growth. Capital expenditures rose to $5.77 billion in Q1 2024 from $5.24 billion within the prior quarter.
First-quarter income rose 16.5% to T$592.64 billion. The robust year-on-year rise was additionally partly pushed by a decrease base for comparability, on condition that TSMC was nonetheless fighting weak chip demand in 2023.
TSMC additionally benefited from weak point within the Taiwan greenback by the primary quarter, which boosted its greenback earnings.
The optimistic earnings come on the again of rising demand for chips from the AI trade. TSMC’s earnings are largely seen as a bellwether for international chip demand, given the agency’s pivotal function within the chipmaking trade.
The agency is the world’s largest contract chipmaker, and has a number of expertise stalwarts, together with Nvidia (NASDAQ:) and Apple (NASDAQ:), as its clients.
Nvdia specifically has been a key supply of demand for TSMC, on condition that the agency makes essentially the most superior AI chips presently obtainable out there.
To this finish, TSMC’s valuation has largely tracked an astronomical rise in Nvidia over the previous yr.
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