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A woman walks past a Taiwan Semiconductor Manufacturing Company (TSMC) logo at the Hsinchu Science Park in Hsinchu on July 5, 2023. (Photo by Sam Yeh / AFP) (Photo by SAM YEH/AFP via Getty Images)Taiwan Semiconductor Manufacturing Company , the world's largest chipmaker, posted a second-quarter profit plunge Thursday as demand for consumer electronics continues to slump. TSMC said business was impacted by macroeconomic headwinds "which dampened the end market demand, and led to customers' ongoing inventory adjustment." This is the company's first quarterly net income decline since the second quarter of 2019. Apple typically releases its latest iPhone in September so it is likely ordering chips from TSMC in the third quarter.
Persons: Sam Yeh, TSMC, Wendell Huang Organizations: Taiwan Semiconductor Manufacturing Company, Hsinchu Science, SAM YEH, Getty Images, Apple Locations: Hsinchu, Hsinchu Science Park, AFP, Taiwan
So far, the law has spurred $200 billion of announced investment in U.S. chip manufacturing, the Semiconductor Industry Association said in December. How much of phone cost is in the chips On its face, a significant hike in chip prices has implications for consumers because chips are such a big component in overall phone manufacturing cost. For Samsung , the combined 5G modem and core apps processor add up to $193 of the $618 manufacturing cost of an S-22 Plus phone. Bringing chip manufacturing to the U.S. is expensive in many respects. "The high costs of construction includes labor costs, costs of permits, cost of occupational safety and health regulations, inflationary costs in recent years, and people and learning curve costs."
Still, Taiwan Semiconductor Manufacturing Co Ltd (TSMC) , the world's most valuable chipmaker, forecast growth would return in the second half of this year. "We forecast the semiconductor cycle to bottom sometime in first half and see a recovery in second half 2023," CEO C.C. The world's largest contract chipmaker said its capital expenditure in 2023 would decrease to $32-36 billion from $36.3 billion in 2022. First-quarter revenue is expected in a range of $16.7 billion to $17.5 billion, compared with $17.57 billion a year earlier. For October-December, TSMC booked record net profit of T$295.9 billion ($9.72 billion) from T$166.2 billion a year earlier.
The chipmaker now expects to spend $32 billion to $36 billion, versus $36.3 billion in 2022, and sees first-quarter revenue in a range of $16.7 billion to $17.5 billion, compared with $17.57 billion a year earlier. "We expect the whole industry to drop slightly but TSMC to grow slightly" in 2023, he said. It reiterated on Thursday slower demand was a cyclical issue and 2023 overall would be a slight growth year for the company. For October-December, TSMC booked record net profit of T$295.9 billion ($9.72 billion) from T$166.2 billion a year earlier. Revenue climbed 26.7% to $19.93 billion, versus TSMC's prior estimated range of $19.9 billion to $20.7 billion.
"We expect probably in 2023 the semiconductor industry will likely decline, but TSMC also is not immune," Wei told a media call. TOOL DELAYSTSMC, Asia's most valuable listed firm, cut its capital expenditure (capex) for 2022 to around $36 billion. "We say 2023 is still a growth year for TSMC, and the overall industry probably will decline," said Wei. Revenue for the quarter climbed 36% to $20.23 billion, versus TSMC's prior estimated range of $19.8 billion to $20.6 billion. Shares in TSMC have fallen almost 36% so far this year, giving it a market value of $323.7 billion.
AMSTERDAM, Oct 13 (Reuters) - Shares in Dutch semiconductor equipment maker ASML (ASML.AS) fell 7% on Thursday after its biggest customer Taiwan Semiconductor Manufacturing Co (TSMC) cut its forecasts for capital spending by 10% this year, citing in part equipment delays. ASML, Europe's largest technology company, did not immediately respond to requests for comment. The company's shares were down 7.0% at 385.10 euros ($371.93) at 1259 GMT. ASML has forecast third quarter sales of 5.1 billion -5.4 billion euros ($4.93 billion-$5.22 billion). ($1 = 1.0354 euros)Register now for FREE unlimited access to Reuters.com RegisterReporting by Toby Sterling; Editing by Susan FentonOur Standards: The Thomson Reuters Trust Principles.
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