TAIPEI: Taiwan Semiconductor Manufacturing Co Ltd (TSMC) reported its 8th straight quarter of profit growth, as the world's largest contract chip maker booked wider profit margins following a boost in demand from mobile device manufacturers.
Asia's 10th biggest company by market value has been able to consistently profit thanks to the spread of smartphones and its ability to produce a high degree of defect-free chips compared with rivals such as Intel Corp, Samsung Electronics Co Ltd and GlobalFoundries, industry watchers say.
That helped net profit rise 21 percent to T$47.9 billion ($1.59 billion) in January-March, the company said in a statement on Thursday.
That compared with the T$43.2 billion mean estimate of 19 analysts polled by Thomson Reuters.
The company previously reported first-quarter revenue of T$148.22 billion, 11.7 percent more than a year earlier, and 7.3 percent more than forecast in January.
Shares of TSMC have risen about 15 percent since the start of the year versus 2.8 percent in the Taiwan SE Weighted Index.
Before the release, they closed 0.8 percent lower compared with a 0.2 percent rise in the benchmark.
TSMC had earlier forecast double-digit profit growth this year as its world-first 20-nanometer chip-making technology begins to supplant the 28-nanometer standard.
The technology allows for increased power and efficiency by packing more transistors onto each chip - which translates into wider profit margins.
TSMC began manufacturing with 20-nanometer technology in January-March, though it has yet to book related revenue.
The company promises further efficiency - and wider margins - with larger silicon wafers, which it had previously said it would start manufacturing in the next few years.
The more transistors on a chip, and the more chips on a wafer, the greater the cost efficiency.
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