TAIPEI (Reuters) – Taiwan Semiconductor Manufacturing Co., a major maker of advanced chips used in artificial intelligence applications, is expected to report a 5% rise in first-quarter profit on Thursday thanks to strong demand. ing. The world's largest contract chipmaker, whose customers include Apple and Nvidia, has boosted TSMC's stock price to record highs as it benefits from a surge in demand for AI that helped weather the pandemic-induced ebb in electronics demand. TSMC is expected to report a net profit of NT$218.1 billion ($6.74 billion) for the quarter ending March 31, according to LSEG SmartEstimate from 22 analysts. SmartEstimates places more emphasis on consistently accurate analyst forecasts. By comparison, net profit in the first quarter of last year was NT$206.9 billion. TSMC reported last week that first-quarter sales rose 16.5%, beating market expectations and at the high end of the company's own guidance.
The company is expected to provide an update on its outlook for the quarter and the rest of the year during its earnings call on Thursday at 0600 GMT, including capital spending, which it previously said would be in the range of $28 billion to $32 billion this year. compared to $30.45 billion last year.
On Wednesday, ASML, the largest supplier of equipment to computer chip makers including TSMC, reported lower-than-expected new bookings in the first quarter, although sales to China held up despite U.S.-led restrictions.
Company executives may also talk about plans in the US state of Arizona, where TSMC announced it would build a third factory there after winning a $6.6 billion subsidy from the US.
TSMC is a world leader in making advanced chips used in everything from smartphones and tablets to fighter jets, but competitors such as Intel and Samsung are trying to challenge its dominance. Intel disclosed this month that operating losses in its foundry business were deepening, a blow to the chipmaker as it seeks to regain the technology lead it has lost in recent years to TSMC. The AI boom has helped boost the stock prices of Asia's most valuable companies, with TSMC's Taipei-listed shares up more than 30% so far this year, hitting a historic high (the overall market rise 12%).
(1 dollar = 32.3700 Taiwan dollars)
(Reporting by Ben Blanchard; Editing by Jamie Freed and Sri Navaratnam)