Q2 2024 Taiwan Semiconductor Manufacturing Co Ltd Earnings Call (Chinese, English) Transcript
Key Points
- Second-quarter revenue increased by 13.6% sequentially in TWD and 10.3% in USD, driven by strong demand for 3- and 5-nanometer technologies.
- Gross margin improved by 10 basis points sequentially to 53.2%, reflecting cost improvements and favorable foreign exchange rates.
- Advanced technology (7-nanometer and below) accounted for 67% of wafer revenue, indicating strong demand for cutting-edge processes.
- HPC platform revenue increased by 28% quarter over quarter, now accounting for 52% of total revenue.
- TSMC raised its full-year 2024 revenue guidance, expecting a slight increase above mid-20s percent in USD terms.
- Continuous smartphone seasonality partially offset revenue gains, indicating ongoing volatility in this segment.
- N3 ramp-up and N5 to N3 tool conversion costs are expected to continue diluting margins.
- Higher electricity prices in Taiwan are contributing to increased operational costs.
- Overseas fabs in Arizona and Kumamoto are expected to dilute gross margins by 2-3 percentage points in the next several years.
- Capacity constraints remain a challenge, particularly for CoWoS and advanced packaging, potentially limiting customer growth.
(spoken in foreign language) Good afternoon, everyone, and welcome to TSMC's second-quarter 2024 earnings conference and conference call. This is Jeff Su, TSMC's Director of Investor Relations, and your host for today.
Today's event is being webcast live through TSMC's website at www.tsmc.com, where you can also download the earnings release materials. (Operator Instructions) The format for today's event will be as follows. First, TSMC's Senior Vice President and CFO, Mr. Wendell Huang, will summarize our operations in the second quarter 2024, followed by our guidance for the third quarter 2024. Afterwards, Mr. Huang and TSMC's Chairman and CEO, Dr. C.C. Wei, will join me and provide the company's key messages. Then, we will open both the floor and the line for the Q&A session.
As usual, I'd like to remind everybody that today's discussions may contain forward-looking statements that are subject to significant risks and uncertainties,
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