TSMC Sees Robust Sales Growth in October

Taipei, Nov. 11, 2011 (CENS)--Taiwan Semiconductor Manufacturing Co. (TSMC) scored unconsolidated net sales of NT$37.25 billion (US$1.2 billion at US$1:NT$30) in October, increasing 13.3% over the previous month but inching down 0.3% from a year earlier.

Industry executives ascribed the robust growth mostly to rush orders from chip vendors adept at devices for tablet PCs and smartphones, including ARM-based processors, 3G baseband chips and wireless networking chips.

They estimated the orders to push up the No.1 foundry's sales goals for the fourth quarter above targeted ranges, which are currently put at a 1.3-3% quarter-on-quarter slip in revenue and a 43.5-45.5% range in gross margin.

TSMC's spokesperson, Lora Ho, pointed out that the company's capacity utilization rate and gross margin for the fourth quarter will rise synchronously and its annual growth pace will stay above the 3-5% average set for the global world semiconductor industry in 2012.

Industry executives noted that the TSMC has sold out all of its 28nm process capacity for this quarter and will step up expansion of the profitable capacity next year.

The October revenue helped swell the company's revenues for the first 10 months this year to NT$352.46 billion (US$11.7 billion), an increase of 4.4% as compared with the same period in 2010.

United Microelectronics Corp. (UMC), No. 2 foundry player, also reported sales growth for October, with its revenue edging up 0.97% from a month earlier, to NT$8.2 billion (US$275 million). Strong handset demand was a major reason behind the company's growth.

According to industry executives, smartphones will suffer less impact of global economic uncertainty next year relative to other applications, inspiring some institutional investors to put “buy” rating on smartphone-concept stocks including TSMC shares.