Company news--Karmin Electronic (HK) Limited

TSMC raises prices beyond expectations, with the highest increase exceeding 10%
2024-10-29

According to the latest news, TSMC's 5nm, 4nm, and 3nm process outsourcing quotes will increase by about 4% in 2025, higher than previously estimated.

TSMC will also adjust pricing for orders related to high-performance computing (HPC) products, including artificial intelligence (AI), with an expected increase of 8% to 10% by 2025; For mobile communication customers, the pricing will increase by about 6%.

Due to TSMC's almost monopolistic position in the process area below 5nm, other suppliers such as Samsung Electronics and Intel may not be able to meet the demand, and their production processes and technological levels are not as good as TSMC's.

TSMC Chairman Wei Zhe jia recently stated that the demand for AI is real, and overall chip demand has stabilized and begun to improve. Calculated in US dollars, it is expected that its revenue for the full year of 2024 will increase by nearly 30%. As the world's largest chip foundry, TSMC's "unexpected" price increase may indicate that the demand for the global semiconductor industry chain is still very strong.

According to TSMC's latest financial report, its revenue for the third quarter was NT $759.69 billion (approximately USD 23.5 billion), a year-on-year increase of 39%; The net profit for the quarter recorded NT $325.258 billion (approximately USD 10.1 billion), a year-on-year increase of 54.2%, which is higher than market expectations. During the period, the company achieved a gross profit margin of 57.8%, an increase of 4.6 percentage points month on month and 3.5 percentage points year-on-year. This gross profit margin performance is far higher than the expected range of 53.3% -55.5% given by the management in the previous financial reporting season. The management pointed out that this is due to higher capacity utilization and more favorable exchange rates.

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