Q3 2024 Taiwan Semiconductor Manufacturing Co Ltd Earnings Call (Chinese, English) Transcript
Key Points
- Third quarter revenue increased by 12.8% sequentially, driven by strong demand for smartphone and AI-related technologies.
- Gross margin improved by 4.6 percentage points to 57.8%, reflecting higher capacity utilization and cost improvements.
- Advanced technologies (7nm and below) accounted for 69% of wafer revenue, showcasing TSMC's leadership in cutting-edge processes.
- TSMC's cash and marketable securities reached TWD2.2 trillion, indicating strong financial health.
- TSMC expects fourth-quarter revenue to increase by 13% sequentially, with a 35% year-over-year growth at the midpoint.
- Inventory days increased by four days to 87 days, primarily due to prebuilding of N3 and N5 wafers.
- Higher electricity prices in Taiwan are expected to impact gross margins by at least 1%.
- Overseas fab costs are higher, leading to a 2%-3% gross margin dilution as new fabs ramp up.
- The company faces challenges in meeting the high demand for CoWoS capacity, despite plans to double capacity.
- TSMC's overseas fabs, such as those in Arizona and Japan, are expected to have lower profitability initially due to smaller scale and higher costs.
Good afternoon, everyone and welcome to TSMCâs third-quarter 2024 earnings conference call. This is Jeff Su, TSMCâs Director of Investor Relations and your host for today, TSMC is hosting our earnings conference call via live audio webcast through the company's website at www.tsmc.com, where you can also download the earnings release materials.
(Conference Instructions) The format for today's event will be as follows. First, TSMCâs Senior Vice President and CFO, Mr. Wendell Huang, will summarize our operations in the third quarter 2024, followed by our guidance for the fourth quarter 2024. Afterwards, Mr. Huang and TSMC's Chairman and CEO, Dr. C.C. Wei, will jointly provide the company's key messages. Then we will open the line for a question and answer session.
As usual, I would like to remind everybody that today's discussions may contain forward-looking statements that are subject to significant risks and uncertainties which could cause
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