TSMC Forecasts Q2 Revenue Over $20B, Up 8%

On April 18th, TSMC provided its quarterly financial update, projecting robust growth for the second quarter of this year. The company anticipates revenue to exceed $20 billion, with a potential increase of up to 8% compared to the previous quarter. The average estimate hovers around $20 billion, indicating a quarter-on-quarter growth rate of approximately 6%.

Wendell Huang, TSMC's Chief Financial Officer, outlined the revenue forecast for Q2, ranging between $19.6 billion and $20.4 billion, based on an assumed USD-to-TWD exchange rate of 32.3.

TSMC's guidance also indicates a projected gross margin of 51% to 53% for Q2, slightly lower than the previous quarter's 53.1%. Operating margin is expected to be in the range of 40% to 42%, maintaining stability compared to Q1.

In Q1, TSMC reported inventory turnover days of 90, with provisions made for 3-nanometer production capacity. The company's capital expenditures for Q1 amounted to $5.77 billion.

Market observers speculate on a potential upward revision of TSMC's revenue and capital expenditure forecasts for the year, following stronger-than-expected sales in the previous quarter. This suggests sustained growth momentum, particularly driven by advancements in artificial intelligence technology.

TSMC's Q1 sales reached NT$592.64 billion, reflecting a 16.5% year-on-year increase, with net profit totaling NT$225.49 billion, up by 8.9% compared to the same period last year. Converted to USD, Q1 2024 revenue amounted to $18.87 billion, marking a 12.9% increase year-on-year, albeit with a 3.8% decrease from the previous quarter.

Additionally, TSMC disclosed that 3-nanometer process shipments accounted for 9% of Q1 2024 wafer sales, while 5-nanometer process shipments constituted 37% of total wafer sales for the quarter. Shipments from the 7-nanometer process contributed 19% to total wafer sales. Overall, revenue from advanced processes constituted 65% of total wafer sales for the quarter.