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TSMC slumps after lackluster earnings report

TSMC slumps after lackluster earnings report

Taiwan's stocks slid for a second day yesterday after Taiwan Semiconductor Manufacturing Co. headed for its biggest drop in seven months after posting its first profit fall in five quarters and forecasting a sales decline.
"The latest string of corporate earnings has been lackluster, if not disappointing," said Sam Hsieh, head of research at Fuh-Hwa Investment Trust Co., which oversees US$275 million in Taiwan. "Evidence of a reversal of this trend would be needed to excite investors."
The Taiex index declined 101.942, or 1.3 percent, to 7821.83 at 11:44 a.m. in Taipei. It has slid 0.1 percent this week. February futures fell 1.4 percent to 7863.
Taiwan Semiconductor, the world's biggest supplier of made-to-order chips, slumped NT$3.10, or 4.4 percent, to NT$67.90, its biggest one-day drop since June 20, 2006. Taiwan Semiconductor said Thursday that its fourth-quarter net income fell 18 percent to NT$27.9 billion (US$851 million) from a year earlier, its first profit decline in five quarters. The chipmaker was expected to post profit of NT$27.2 billion, according to the median estimate in a Bloomberg News survey of 13 analysts.
The slump is set to continue this quarter, with Taiwan Semiconductor forecasting a sales decline from a year earlier.
"Their outlook for the first quarter is below our expectations," Ernest Chiang, who manages US$27 million of assets which don't include Taiwan Semiconductor, for Ta Chong Investment Trust Corp., said yesterday. "We don't have so much confidence in their second quarter either."
Sales for the current quarter will be between NT$62 billion and NT$64 billion, Taiwan Semiconductor said at an investors' conference after the close of trading yesterday.
Stunted growth
Worldwide semiconductor-industry sales will grow between 4 percent and 6 percent this year, compared with growth of between 8 percent and 9 percent last year, Taiwan Semiconductor chief executive Rick Tsai told investors in Taipei.
United Microelectronics Corp., the world's second-largest custom-chip maker, slipped 35 cents, or 1.6 percent, to NT$21.25.
Exporters declined after the Commercial Times reported the Taiwan Institute of Economic Research cut the island's economic growth forecast for this year to 4.07 percent from the 4.11 percent it predicted in November, on slowing exports.
The institute also lowered its growth estimate for the island's exports of goods and services this year to 5.51 percent from its earlier 5.79 percent forecast, the newspaper said.


Updated : 2021-08-04 02:51 GMT+08:00