TSMC(US:TSM) Benzingaยท2025-01-16 10:36Core Viewpoint - Taiwan Semiconductor Manufacturing Co (TSMC) reported strong fourth-quarter results driven by demand for advanced processor technologies, particularly for artificial intelligence applications, and provided an optimistic revenue outlook for the first quarter of 2025 [1][3]. Financial Performance - TSMC's fourth-quarter revenue reached $26.88 billion (NT$868.46 billion), representing a year-over-year increase of 38.8%, surpassing the analyst consensus estimate of $26.28 billion [2][3]. - The company's net income was NT$374.68 billion, with earnings per share at NT$14.45 ($2.24), slightly above the consensus of $2.23 [2]. - Revenue growth in dollar terms was 37.0% year-over-year and 14.4% quarter-over-quarter, aligning with the company's guidance of $26.1 billion to $26.9 billion [3]. Technology and Revenue Breakdown - TSMC's revenue composition included 26% from 3-nm technology, 34% from 5-nm technology, and 14% from 7-nm technology, with advanced technologies (7-nm and above) accounting for 74% of total wafer revenue [4]. Margin Analysis - The company achieved a gross margin of 59%, an increase of 600 basis points, attributed to its competitive advantage in AI technology and the success of its 3-nm and 5-nm chips [5]. - Operating margin expanded by 740 basis points to 49% [5]. Future Outlook - TSMC projects first-quarter 2025 revenue between $25.0 billion and $25.8 billion, exceeding the consensus estimate of $24.97 billion, with expected gross margins of 57% to 59% and operating profit margins of 46.5% to 48.5% [6]. - The company plans to allocate $38 billion to $42 billion in capital expenditures for fiscal 2025, up from $29.8 billion the previous year, amid rising geopolitical tensions [7]. Stock Performance - TSMC's stock has surged over 103% in the last 12 months, reflecting strong investor confidence [7]. - The stock traded higher by 4.86% at $216.85 in premarket trading [8].