TSMC revenue jumps 50% in November, helped by Apple iPhone orders

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TSMC has weathered a slowdown in areas of the chip market despite rising prices, fears of a global recession and Covid unrest in China.

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TSMCThe world’s largest contract maker, on Friday reported an increase in November revenue due in part to orders for semiconductors for high-end smartphones such as Apple’s iPhone.

The Taiwanese company, which makes chips for other companies, said November revenue was 222.71 billion New Taiwan dollars ($7.27 billion), an increase of 50.2% year over year.

TSMC makes chips for a wide range of companies, including the latest semiconductors for Apple and Qualcomm as well as Bank Soft– Army property. The company has halted a decline in areas of the chip market due to rising prices, fears of a global recession and Covid unrest in China.

The November earnings report puts TSMC on track to beat its previously announced fourth-quarter guidance of $19.9 billion to $20.7 billion. In October and November, TSMC’s revenue totaled approximately $14.1 billion.

“TSMC’s October/November earnings are in line with management’s guidance 2 months ago, despite a significant slowdown in business in many other names,” said Dale Gai, analyst at Half -sort of at Counterpoint Research, to CNBC via email.

Gai said “high-end smartphones” such as the A16 chip for Apple’s iPhone and the latest semiconductor from Qualcomm contributed to “most of (TSMC)’s seasonal strength.”

The analyst said some chips for high-performance computing contributed to the strong set of numbers.

TSMC is arguably the most important semiconductor manufacturer in the world. It has a large set of clients who depend on it for the latest chips.

It was also caught in the middle of the US-China tech battle over chips. The United States has tried to cut China off from critical chips and devices as it tries to recover semiconductor production.

Earlier this week, TSMC announced the opening of a second chip plant in Arizona, increasing its investment in the state from $12 billion to $40 billion. President Joe Biden was at the event where the investment was announced, confirming the important role that TSMC will play in the American semiconductor sector.

Apple CEO Tim Cook was also present at the event and said that the iPhone maker would buy chips made at TSMC in the US.

While TSMC’s November earnings are getting a boost from Apple, analysts are worried about weaker orders next year.

“The real test for the company” is in the first half of 2023, said Sze Ho Ng, an analyst at investment bank China Renaissance.

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