TSMC posts gloomy financials before Apple's A6 chip debut

CHIP SHOP Taiwan Semiconductor Manufacturing Company (TSMC) has reported a decline in year-on-year sales for the fourth quarter of 2011, yet still managed to beat analyst expectations.

TSMC, the preferred chipmaker for AMD's and Nvidia's GPUs, announced revenues of £2.275bn for the fourth quarter of 2011 with profit edging above £686m. Although those figures beat analysts' expectations its revenue was down 4.9 per cent and profit was down 22.5 per cent from the same quarter of the prior year.

In TSMC's financial filing the firm said 30 per cent of its revenue came from 65nm production, with 27 per cent from its mature 40nm process node. Just two per cent came from its 28nm process node, but that figure is expected to grow throughout 2012.

The fact that TSMC beat analyst expectations even after posting a 22.6 per cent fall in profit shows just how tough the tail end of 2011 was for semiconductor vendors, even with chip demand from growing smartphone and tablet sales.

TSMC has been chosen by Apple to fab its upcoming A6 chip that is expected to tip up in the firm's expected Ipad 3 and Iphone 5. The sales volumes those devices are likely to generate in 2012 are expected to lift TSMC's income statement this year. µ