Photo = EPA
Taiwan TSMC, the world’s largest semiconductor consignment manufacturer (foundry), posted its record-high quarterly performance in the fourth quarter of last year thanks to full-fledged sales of the 5-nano process. Huawei, one of the largest customers, fled due to US sanctions, but it is analyzed that Apple and Xiaomi have increased orders further.
TSMC announced on the 14th that it achieved sales of USD 361.5 billion (about 14.14 trillion KRW) in the fourth quarter of 2020. It increased by 14% compared to the same period last year. Net profit increased by 23% to 142.7 billion Taiwan dollars. The net margin rose from 36.6% to 39.5% over the same period. Both sales and net profit were the highest on a quarterly basis.
TSMC Chairman Liu Dein said at a performance briefing session, “In the fourth quarter, the plant utilization rate was high and the exchange rate conditions were good.”
The proportion of sales by product was calculated as smartphones 51%, high-performance computers 31%, Internet of Things (IoT) 7%, and automobiles 3%. TSMC suspended its deal with Huawei, which is subject to US sanctions, on September 15 last year. The industry analyzed that Apple increased orders to occupy a vacant place in Huawei, and China’s Xiaomi and Oppo also expanded orders.
In terms of sales composition by process, the proportion of the 5nm (nm) business, an ultra-fine process that started operation last year, jumped from 8% in the third quarter to 20% in the fourth quarter. TSMC classifies 16nm and below as high-end technologies with high profitability. The share of high-end technology sales rose from 56% in the fourth quarter of 2019 to 62% in the fourth quarter of last year. According to Taiwanese market research firm Izea Research, TSMC’s major 5nm customers include Apple, AMC, Broadcom, Bitmain, and Xilinx. Apple is entrusting the production of the A14 chip installed in the iPhone 12 and iPad Air 4 to TSMC.
At the performance briefing, the company also announced plans to test-produce 3-nano products this year and mass-produce in the second half of next year. Chairman Ryu said, “We are continuously lowering the cost of the 3-nano production line and are negotiating with customers in the field of smartphones and high-performance computers.”
TSMC’s annual performance last year was estimated to be KRW 1.3392 trillion in sales (about 52.38 trillion KRW) and KRW 5178 billion in net profit (about 2,250 trillion KRW). Sales increased by 31% and net profit by 50% compared to the previous year. Chairman Ryu predicted that it will continue to grow at an annual average of 10-15% over the next five years.
Beijing = correspondent Kang Hyun-woo [email protected]
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