(Bloomberg) – Taiwan Semiconductor Manufacturing Co.’s quarterly sales rose at the fastest pace in more than a year, raising hopes that a global AI development boom is fueling demand for high-end chips and servers. .
Most Read Articles on Bloomberg
The leading chipmaker for Nvidia Corp. and Apple Inc. expects March quarter sales to be 16% higher than expected at about NT$592.6 billion ($18.5 billion), compared with the average forecast of NT$579.5 billion. It was reported that it exceeded the
The performance lends weight to hopes that the world's most valuable chipmaker can overcome a post-pandemic plunge in smartphone and computer sales and return to solid growth this year. TSMC has budgeted $28 billion to $32 billion in capital spending and expects revenue to rise at least 20% this year, reversing a slight decline in 2023.
Asia's largest company has more than doubled in value since its October 2022 low as investors bet on sustained demand for the advanced AI chips it makes for Nvidia and others. This allays persistent concerns that the global smartphone recession may be over. The company plans to release full earnings on April 18th.
TSMC announced in January that AI revenue is growing 50% annually. The company is building factories in the United States, Japan and Germany to make AI chips used in data centers run by internet giants such as Amazon.com and Microsoft.
There are also growing signs of a broader market recovery. Asian rival Samsung Electronics' first-quarter profits rebounded sharply, in part due to an improvement in the company's core semiconductor division.
Still, some investors have warned that the current level of demand for AI chips is unsustainable in the long term. Some remain cautious given the uncertainty surrounding the Taiwan Strait, a narrow stretch of water between mainland China and the islands that China considers a breakaway province.
And Apple, TSMC's most important customer, is struggling to grow iPhone sales as Huawei Technologies Co. erodes its dominance in the high-end market, especially in China.
–With assistance from Cindy Wang.
Most Read Articles on Bloomberg Businessweek
©2024 Bloomberg LP