TSMC(US:TSM) Huachuang Securities·2025-04-18 07:52Investment Rating - The report assigns a positive outlook for TSMC, indicating strong performance driven by AI demand and a projected revenue growth of approximately 25% for the year 2025 [4][22]. Core Insights - TSMC's Q1 2025 revenue reached NT$839.25 billion (US$25.53 billion), reflecting a year-over-year increase of 35.3% and a quarter-over-quarter decrease of 5.1% [2][8]. - The gross margin for Q1 2025 was 58.8%, up 5.7 percentage points year-over-year, although it saw a slight decline of 0.2 percentage points from the previous quarter [2][8]. - The net profit attributable to shareholders was NT$361.56 billion, representing a year-over-year increase of 60.3% [2][8]. Revenue Breakdown By Market Segment - In Q1 2025, the revenue breakdown by market segment was as follows: - Mobile: 28% (QoQ -22%) - HPC (High-Performance Computing): 59% (QoQ +7%) - IoT: 5% (QoQ -9%) - Automotive: 5% (QoQ +14%) - Digital Consumer Electronics: 1% (QoQ +8%) - Others: 2% (QoQ +20%) [2][14]. By Process Technology - Revenue by process technology in Q1 2025 was as follows: - 3nm: 22% (QoQ -4 percentage points) - 5nm: 36% (QoQ +2 percentage points) - 7nm: 15% (QoQ +1 percentage point) - Advanced process technologies (7nm and below) accounted for 73% of total wafer revenue [3][18]. Capital Expenditure and Inventory - TSMC's capital expenditure for Q1 2025 was approximately US$10.06 billion, a decrease of US$1.17 billion from Q4 2024. The company expects capital expenditure for 2025 to be in the range of US$38 billion to US$42 billion, with 70% allocated to advanced process technologies [12][22]. - The inventory days at the end of Q1 2025 were 83 days, an increase of 3 days from the previous quarter, primarily due to ramp-up in overseas factory capacity [13]. Q2 2025 Guidance - For Q2 2025, TSMC expects revenue to be in the range of US$28.4 billion to US$29.2 billion, representing a quarter-over-quarter increase of 12.8% and a year-over-year increase of 38.3% [4][22]. - The company anticipates a gross margin of 57% to 59% for Q2 2025, with an operating margin of 47% to 49% [4][22].