Major Apple Supplier Taiwan Semi (TSM) Tops 4Q Revenue and Guidance Estimates, Shares Gain; Analyst Positive

Taiwan Semi (NYSE: TSM) said its revenue soared 24.1% to $15.74 billion while net profit jumped to T$166.2 billion ($6.01 billion). Analysts were calling for T$161.6 billion.

For this quarter, Taiwan Semi projects sales in the range of $16.6 billion to $17.2 billion, compared to $12.92 recorded a year ago. The company sees a Q1 gross margin between 53% and 55%, higher than the 51.8% estimate.

On a full-year basis, Taiwan Semi is calling for sales to grow by mid- to high 20%. On the Capex front, Taiwan Semi forecasts capital spending between $40 billion and $44 billion this year, much higher than $30 billion for 2021.

Expansion plans are mostly related to investments in new technologies, such as 5G and AI.

Stifel analyst Patrick J. Ho is positive on the company’s plans to increase investments.

“It is notable that management cited multiple times that the semiconductor industry is experiencing a “structural increase in demand,” which would more than support their sharp capex increase and our secular view on the equipment industry. We maintain our favorable bias on the equipment group both near term and long-term,” Ho wrote in a client note.

TSM stock price is up over 4% in pre-open Thursday.

By Senad Karaahmetovic | [email protected]

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