Published on October 19, 2023, 11:46 am
Image source: Fox News
Apple’s iPhone processor manufacturer, TSMC, has reported a significant drop in profits for the latest quarter, despite the release of the iPhone 15 range. While analysts had predicted a decline in TSMC’s profits, they expected a rebound in the following quarter due to demand for Apple’s new iPhones. However, TSMC’s figures still represent their biggest decline since Q1 2019. In Q3 2023, TSMC earned a profit of $6.69 billion, with revenue dropping by 10.83% year on year and net income falling by 24.87% over the same period.
TSMC credited the strong ramp-up of its industry-leading 3-nanometer technology and increased demand for 5-nanometer technologies as factors supporting their business. However, this was partially offset by customers’ ongoing inventory adjustment. While TSMC is Apple’s sole manufacturer of Apple Silicon processors and relies heavily on revenue from Apple, the company expects its business in the fourth quarter to be supported by the continued strong ramp-up of its 3-nanometer technology.
According to TSMC CEO CC Wei, there is increased demand for processors due to AI but it is not enough to offset weakening demand for consumer electronics. China’s slower demand recovery and weaker overall macroeconomic conditions have made customers more cautious in their inventory control.
Despite these challenges, Wei mentioned that there are early signs of demand stabilization in the PC and smartphone market. Additionally, TSMC announced plans to begin production of 2 nanometer processors by 2025.
In conclusion, TSMC’s latest earnings report reflects a significant drop in profits despite the release of the iPhone 15 range. The company attributes this decline to various factors but remains optimistic about future quarters with continued technological advancements and potential demand stabilization in key markets.
Original article posted by Fox News