Taiwan Semiconductor Manufacturing Company (TSMC) on Thursday said its supply of micro-controlling units, an automotive chip component, has increased by 30% over the past six months.
The company's CEO, CC Wei, provided the chip supply update during the company's second-quarter results presentation, where he added that output for micro-controlling units should be close to 60% higher than 2020 levels and 30% higher than the 2018 pre-pandemic levels, respectively, by the end of the year.
"By taking such actions, we expect the shortage to be greatly reduced for TSMC customers starting this quarter," Wei told investors.
Two months ago, the company announced plans to spend $100 billion over three years to boost capacity.
The increase in automotive chip components should be good news for automotive manufacturers, who have struggled to produce cars since the pandemic started due to chip shortages, with some countries' car production being halved during that period.
Ford, for example, is expecting to lose up to half of its planned production in the second quarter of 2021, while General Motors has stated that losses caused by the lack of semiconductors could cost up to $2 billion in profit.
The update was made as part of the company's second-quarter results presentation, where the company also told investors it earned net income of NT$134 billion for the second quarter ended June 30, which was an 11% year-on-year increase.
Consolidated revenue was NT$372 billion -- $13.3 billion -- which marked a 20% improvement from last year's second quarter performance, while operating expenses amounted to NT$40.6 billion, and net profit margin was 36%.
Apportioning TSMC's revenue by technology, 5nm chips accounted for 18% of total revenue; 7nm accounted for 31%. Meanwhile, advanced technologies, defined as 7nm and more advanced technologies, accounted for 49% of total revenue.
According to TSMC vice president and chief financial officer Wendell Huang, revenue earned during the quarter was primarily off the back of continued demand for chips in smartphones and high-performance computing (HPC), which accounted for 42% and 39% of revenue, respectively. At the same, the company saw demand for technologies in automotive-related platforms rise by 12% during the quarter.
The chipmaking giant also provided guidance for the upcoming quarter, saying it expected gross revenue to be between $14.6 billion and $14.9 billion. It added that its operating profit margin was expected to rise slightly to between 38.5% and 40.5%.
"Moving into third quarter 2021, we expect our business to be supported by strong demand for our industry-leading 5nm and 7nm technologies, driven by all four growth platforms, which are smartphone, HPC, IoT, and automotive-related applications," Huang said.
Earlier this week, TSMC and Foxconn both signed contracts to purchase 10 million COVID-19 vaccines on behalf of Taiwan.
In a statement to the Taiwan Stock Exchange, TSMC said it acquired five million doses of the Pfizer COVID-19 vaccine and gave them to the Taiwan Centers for Disease Control.
"TSMC donates five million doses of BNT162b2 vaccine for use to fight off the COVID-19 pandemic," the chipmaker said.
Foxconn and TSMC are aiming to purchase 5 million doses of COVID-19 vaccine each, before donating them to the Taiwanese government.
The automotive industry's semiconductor shortage will be largely resolved next quarter, says Taiwan-based chip maker.
Foxconn is best known for making your iPhone but is now gunning to make electric vehicles via a partnership with Fisker.