Taipei (AFP) – Taiwanese chipmaking giant TSMC reported Thursday a forecast-beating 60 percent rise in net profit for the second quarter on sustained demand for artificial intelligence technology. Taiwan Semiconductor Manufacturing Company is the world’s largest contract maker of chips and counts Nvidia and Apple among its clients. The firm said its net profit for the three months to June soared 60.7 percent from a year ago to NT$398.3 billion (US$13.5 billion). That beat expectations of NT$376.97 billion, according to a Bloomberg News survey of analysts.
Second-quarter revenue was up 39 percent on-year, also topping forecasts. Chips are essential for generative AI, which has exploded in recent years and transformed the global economy, and demand for them was expected to remain “robust,” TSMC chairman and chief executive CC Wei told a briefing Thursday. TSMC also upgraded its revenue forecast for the year, easing fears of an AI slowdown and pushing its US stock futures higher.
Nvidia said this week it will resume sales of its H20 AI chips to China after Washington pledged to remove licensing restrictions that had halted exports. Wei welcomed Nvidia’s “good news.” “China is a big market and my customer can still continue to supply the chip to the big market and it’s very positive news for them, and in return it’s very positive news for TSMC,” Wei said.
The quarterly results follow US President Donald Trump’s latest barrage of tariffs and renewed threats to impose levies on pharmaceutical products and chips. Wei said last month that the company “may be affected” if the tolls force up prices and demand for chips falls, but he added: “Our business will still be very good.”
Taiwan has been locked in negotiations with Washington over Trump’s threat to impose a 32 percent tariff on the island’s exports if they do not strike a deal by August 1. To help its case, Taipei has pledged to increase investment in the United States, buy more US energy, and increase its own defence spending.
© 2024 AFP
