Taiwan Semiconductor Manufacturing Co. (TSMC) saw a decrease in net profit in the third quarter as revenue from smartphones and high-speed computing chips decreased, leading to a deterioration in profit margins.
The world's largest chip foundry said on Thursday that its net profit decreased by 25% year-on-year to NT $211 billion (approximately US $6.51 billion). The result exceeded expectations. According to a survey conducted by S&P Global Market Intelligence, analysts expect TSMC's net profit to be NT $189.70 billion.
Net profit increased by 16% compared to the second quarter.
In the third quarter, revenue decreased by 11% year-on-year to NT $546.73 billion, but increased by 14% month on month.
In recent months, this chip manufacturer has been facing a decline in sales as customers clear inventory. Prior to this, the company experienced a period of strong growth because the COVID-19 epidemic promoted the growth of demand for smart phones and data centers.
The company's operating profit margin decreased to 41.7%, a year-on-year decrease of 8.9 percentage points, and a month on month decrease of 0.3 percentage points.
In the third quarter, smartphone revenue increased by 33% month on month, while high-performance computing revenue increased by 6%. The revenue from the automotive business decreased by 24% month on month.
TSMC stated that revenue from North American customers accounted for 69% of total revenue, up from 66% in the second quarter; The revenue from Chinese Mainland accounted for 12%, the same month on month.