Taiwan TSMC Raises Capital Expenditure to 33 Trillion Won This Year

[Image source= AFP Yonhap News]

[Asia Economy Reporter Park Byung-hee] Taiwan's TSMC, the world's largest semiconductor foundry, has raised its capital expenditure plan for this year to $30 billion (approximately 33.5 trillion KRW), according to Taiwan media such as the Apple Daily on the 16th (local time).

At the Q1 earnings briefing held the previous day, TSMC announced that it would adjust its capital expenditure to a record high of $30 billion along with its operational outlook for this year.

Wei Zhejia, TSMC's CEO, explained that due to increased demand for 5G, high-performance computing (HPC), and specialized manufacturing processes, the company decided to raise its previously announced capital expenditure plan from $25 billion to $28 billion to $30 billion.

CEO Wei forecasted that the semiconductor industry will grow by 12% this year, and the foundry sector will grow by 16%. He also added that the shortage of automotive semiconductors is expected to improve significantly by the third quarter. However, he noted that a complete resolution might only be possible by the year after next.

CEO Wei stated that digitalization is accelerating due to COVID-19 and pledged to achieve $100 billion in investments over the next three years to meet customer demand. Regarding TSMC's semiconductor factory being built in Arizona, USA, he said that future production expansion plans will be decided based on market demand and production yield.

TSMC's Q1 revenue this year was NT$362.41 billion (approximately 14.3 trillion KRW), up 0.2% from Q4 last year and 16.7% year-on-year. Operating profit was NT$150.538 billion, up 17.1% year-on-year, and net profit was NT$139.69 billion, up 19.4% year-on-year.

Huang Renjiao, Chief Financial Officer (CFO), projected Q2 revenue to increase by 2.17% to between $12.9 billion and $13.2 billion, with an operating margin of 38.5% to 40.5%.

This content was produced with the assistance of AI translation services.