TSMC's net profit in the third quarter was US$8.8 billion, a year-on-year increase of 79.7%. Full-year capital expenditures were revised down by 18%.

On October 13, TSMC, the leading wafer foundry, held a press conference today and announced its third quarter financial report. Both revenue and profits maintained double-digit growth month-on-month, exceeding analysts’ expectations. In the current global semiconductor market Against the background of the decline, TSMC's excellent profitability as a leading company in the semiconductor industry is highlighted. However, in response to the semiconductor industry entering a downward cycle, TSMC also revised down its capital expenditures for 2022.

Specifically, in the third quarter of 2022, TSMC's revenue was NT$613.14 billion, an increase of 14.8% from the second quarter and a year-on-year increase of 47.9% from the same period in 2021; its net profit increased by 18.5% from the previous quarter, a year-on-year surge. 79.7%, reaching NT$280.9 billion (approximately US$8.8 billion), higher than the average estimate of NT$264.66 billion by industry analysts; EPS per share reached NT$10.83, better than previous expectations ; The gross profit margin in the third quarter was 60.4%, which was also higher than the expected 58.9%; the operating profit margin was 50.6%, and the net profit margin was 45.8%, which were also higher than expected.

Cumulative revenue in the first three quarters of 2022 reached NT$1,638.359 billion, an increase of 42.6% compared with the same period in 2021, and EPS per share reached NT$27.79. The EPS per share in the first three quarters of 2022 has already exceeded the results for the whole year of 2021.

Judging from the proportion of wafer sales of each process node in total revenue, 5nm revenue accounted for 28% in the third quarter, an increase of 7 percentage points compared with 21% in the second quarter; 7nm revenue proportion It was 26%, down 4 percentage points from 30% in the second quarter. The total revenue of advanced process nodes below 7nm accounted for 54%. 16nm revenue accounts for 12%, and 28nm revenue accounts for 10%.

Huang Renzhao, vice president and chief financial officer of TSMC, also said: "Strong market demand for TSMC's industry-leading 5nm process technology has provided support for our business in the third quarter."

Judging from the proportion of revenue contributed by the final product application field, high-performance computing (HPC) chip sales increased by 4% in the third quarter compared with the second quarter, and the revenue proportion reached 39%. However, compared with the second quarter, 43% decreased by 4 percentage points; smartphone chip sales increased by 25% compared with the second quarter, and revenue accounted for 41%, an increase of 3 percentage points compared with 38% in the second quarter; automotive chip business revenue was relatively It increased by 15% compared with the second quarter, and the revenue accounted for 5%, which was the same as the second quarter; the Internet of Things chip business also performed strongly, with revenue increasing by 33% quarter-on-quarter, and the revenue accounted for 10%, which increased compared with the second quarter. 2 percentage points.

Obviously, Apple’s iPhone 14 series’ demand for A15 and 16 chips has given greater impetus to the growth of TSMC’s smartphone chip business and 5nm process share, and has also made TSMC’s mobile phone chip business contribute the largest share of revenue of all Top 41% in category.

Looking forward, Huang Renzhao said that in the fourth quarter of 2022, market demand for TSMC's industry-leading 5nm process will continue to increase, thus balancing the impact of weakening end market demand and customers' continued inventory adjustments. TSMC's performance is expected to will remain flat.

For the fourth quarter performance forecast, revenue in US dollars is expected to be between US$19.9 billion and US$20.7 billion. Based on the exchange rate of NT$31.5 to 1 US dollar, the revenue will be between NT$626.85 billion and NT$652.05 billion, the gross profit margin will be between 59.5% and 61.5%, and the operating profit rate will be between 49% and 49%. between 51%.

In addition, in response to the capital expenditure issue that the market is concerned about, Huang Renzhao said that it will further lower its capital expenditure in 2022 to US$36 billion. This is also the second time that TSMC lowered its capital expenditure in 2022 to nearly US$40 billion three months ago. capital expenditures. Compared with the US$44 billion in capital expenditures proposed at the beginning of 2022, this has been revised down by more than 18%.

As for the reason for the downward revision of capital expenditures, Huang Renzhao explained that it was mainly due to the recent larger-than-expected adjustment of semiconductor inventory, coupled with the continued variables such as inflation, the Russia-Ukraine conflict, and interest rate increases, which caused customers to postpone their production expansion plans. cause.

Regarding the capital expenditure status in 2023, Huang Renzhao emphasized that the current estimate is still too early and is expected to be announced in January 2023.