TAIPEI, July 9 (Reuters) – Top contract chipmaker TSMC (2330.TW) wrapped up the second quarter with record sales for a third month in June on stronger demand for PCs and electronic devices, with the company on track to book a record profit this year.
Second-quarter sales beat its own forecast and were also higher than analysts’ expectations as Taiwan Semiconductor Manufacturing Co’s (TSMC) (TSM.N) early adoption of more advanced technology helped boost capacity and gain new orders from overseas clients that are increasingly outsourcing manufacturing to major chip foundries in Asia.
Despite worries over financial troubles in Europe, TSMC Chairman Morris Chang has said the global chip market should remain in good shape in the second half as global chip sales would grow about 30 percent this year. [ID:nTOE65E03Y]
“As a sector leader, TSMC has a wider customer base and sells chips for so many different products, that can spread risk, so fundamentals are pretty good but investors already know that,” said Alan Tseng, a vice-president at Capital Securities.
TSMC shares closed flat in Taiwan ahead of the results on Friday, versus a 0.5 percent gain on the main TAIEX share index .
Graphic on TSMC/UMC combined sales, click
In a Monday report, JP Morgan said TSMC’s near-term outlook remained intact and it rated the company at “overweight”.
TSMC, which counts Texas Instruments (TXN.N) and Nvidia (NVDA.O) among major clients, reported unconsolidated sales of T$35.11 billion ($1.1 million) for last month.
That was up 36 percent from a year earlier and up 3.8 percent from May, it said, without giving other details.
A day earlier, smaller cross-town rival United Microelectronics Corp (UMC) (2303.TW)(UMC.N) said June sales rose 25.5 percent from a year earlier, the highest level in nearly three years. [ID:nTOE66603R]
TSMC and UMC helped boost Taiwan’s exports 34 percent in June but growth slowed from the previous month — a sign that global demand, especially for technology products, may be slipping. [ID:nTOE66705X]
On a consolidated basis, TSMC’s sales totalled T$197.15 billion in January-June, up 73.4 percent from a year earlier.
April-June sales were T$104.96 billion, beating TSMC’s own forecast of between T$100-102 billion and higher than market expectations for T$101.6 billion, according to Thomson Reuters I/B/E/S.
TSMC is set to report second-quarter earnings and give guidance for the third quarter in late July. (US$1=T$32) (Editing by Chris Lewis)