TSMC optimistic for coming year

29 Apr 2008 | 14:10 BST

By Sylvie Barak

DESPITE WORRIES about a market in crisis, Taiwanese chipmaker TSMC (Taiwan Semiconductor Manufacturing), gave investors plenty of hope to cling to as it cautiously pushed an optimistic prediction for good year-on-year profit growth.

TSMC reckoned that, due to the continuing upward pressure on the Taiwanese dollar against the US dollar, second quarter profits and revenues will likely remain flat, although a high demand in consumer electronics is still driving growth.

Most investors were biting their fingernails nervously to see what TSMC would report from its first quarter, after months of worry about potential fallout from the US subprime crisis. But TSMC pulled through, reporting $28.1 bn in net income for Q1, up 49.4 per cent from last year. TSMC share prices were also up by 54 per cent, bringing them to T$1.10.

Because TSMC is so big, and because it covers a veritable plethora of segments within the tech industry, many analysts and investors were watching the company closely for any signs that it might have taken a hit from the global financial crisis. But it seems that the angst was either unnecessary, or premature, because this year is looking strong for all the Taiwanese tech giants.

Compatriot computer seller Acer was also being optimistic about the coming three quarters, whilst Quanta computer announced on Monday that it was predicting a 10 per cent rise in shipments in the next quarter, with a 25 per cent rise in shipments for the whole year.

Chief executive of TSMC, Rick Tsai, told the Financial Times that he estimated that the semiconductor industry would probably grow by about four to six per cent, a low figure due to depressed prices and problems in the memory segment of the market.

But overall, things are looking up. Tech-sellent. µ

L’Inq
Fin ancial Times

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