Barron's
Date: Oct. 15, 2020
By: Eric J. Savitz

Taiwan Semiconductor, the world’s largest contract chip manufacturer, reported better-than-expected third-quarter financial results on Thursday, as demand grows for the company’s cutting-edge chips.

Taiwan Semi (ticker: TSM) posted revenue of $12.1 billion, up 29% from a year earlier and ahead of the Wall Street analyst consensus forecast at $11.5 billion. Profit was 90 cents per American depositary receipt, above the Street consensus at 77 cents.

The company is projecting fourth-quarter revenue of $12.4 billion to $12.7 billion, which likewise is above the Street consensus at $12.7 billion. Taiwan Semi expects fourth quarter gross margin of 51.5% to 53.5%, which compares with 53.4% in the third quarter. Operating margin is expected to be 40.5% to 42.5%, compared with 42.1% in the third quarter.

“Our third-quarter business benefited from the strong demand for our advanced technologies and specialty technology solutions, driven by 5G smartphones, [high-performance computing] and IoT-related applications,” Taiwan Semiconductor CFO Wendell Huang said in a statement. “Moving into fourth quarter 2020, we expect our sequential growth to be supported by strong demand for our industry-leading 5-nanometer technology, driven by 5G smartphone launches and HPC-related applications.”    [FULL  STORY]