TSMC Q2 profit highest in six quarters on smartphones

Taiwan Semiconductor Manufacturing Co (TSMC) has reported its highest profit in one and half years, lifted by demand for chips used in smartphones; expects higher revenue next quarter.

Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, has posted its highest profit in six quarters, according to its second quarter results released Wednesday.

For the three months ended June, net income rose to NT$41.8 billion (US$1.4 billion)--up 16.3 percent from the previous year. This was on the back of 15.9 percent rise in sales to NT$128 billion (US$4.2 billion) over the same period.

In the statement, the company said it experienced stronger than seasonal growth during the second quarter due to strong demand for mobile computing related applications, partincularly its 28-nanometer process technology.

“We expect to double the shipments of 28-nanometer in the third quarter. This increase in 28nm business will account for more than 80 percent of revenue growth in the third quarter,” said Lora Ho, senior vice president and chief financial officer of TSMC.

For the third quarter, it expects revenue to fall between NT$136 billion (US$4.5 billion) and NT$138 billion (US$4.6 billion); gross profit margin is expected to be between 46 percent and 48 percent; and operating profit margin is expected to be between 34 percent and 36 percent.