TSMC raises 2020 revenue forecast on strong 5G demand

Company said net income grew 36% year-on-year to NT$137.31 billion in third quarter

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TSMC logo (Reuters photo)

TSMC logo (Reuters photo)

TAIPEI (Taiwan News) — Taiwan Semiconductor Manufacturing Company (TSMC) raised its 2020 revenue forecast on Thursday (Oct. 15) based on strong demand for 5G phones and high-performance computing.

TSMC Chief Executive Officer C.C. Wei (魏哲家) told investors in a third quarter earnings call that revenue would grow by 30 percent in U.S. dollar terms, according to CNA. After the second quarter, the company had stated it forecast 2020 revenues to increase by 20 percent.

The Taiwan company said net income grew 36 percent year-on-year to NT$137.31 billion (US$4.74 billion) in the third quarter, a record-high quarterly net profit, while revenues increased 22 percent to NT$356 billion, according to the Financial Times. The group added that it expects fourth quarter revenues to be between US$12.4 billion and US$12.7 billion.

Taiwan’s chip exports had a boost in August and September as China’s Huawei began to stockpile semiconductors before U.S. sanctions took effect mid-September. However, analysts said the revised forecasts show the demand from TSMC’s chips was strong and went beyond last-minute orders from Huawei, the Financial Times said.

TSMC said uncertainty in global supply chains due to the pandemic drove sales of semiconductors for a wide range of customers. Wei noted that inventory levels in the chip industry would remain high at the end of the year due to supply chain concerns, CNA reported.