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TSMC Reports Q3 Earnings [pdf]

investor.tsmc.com

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Re: TSMC Reports Q3 Earnings [pdf]

#21

Post by abudabi123 »

sandos wrote: post #4
cgeier wrote: post #2

> Gross margin for the quarter was 60.4%, operating margin was 50.6%, and net profit margin was 45.8%. Still surprised how profitable TSMC is. Especially as this seems to be below the market expectations (their stock is still falling).

I hate economics and know nothing really, but those numbers are the highest margins I have ever seen ? Aren't they profitable because they are in a unique position? I would hope they keep being profitable. What happens if they would fail?

Should TSMC fail due to one of the causal factors being geotech political interference on the horizon from the clash of China's Communist Party and the U.S. Wario Blob mic you would think ASML has wargamed plans to supply demand.

Re: TSMC Reports Q3 Earnings [pdf]

#23

Post by selykg »

mousetree wrote: post #14
manuelabeledo wrote: post #6

Earlier quoted context omitted.

> those numbers are the highest margins I have ever seen ? It’s not unusual to see 70%+ margins in software products.

TSMC don't sell software products

They weren't implying that, see the quote they included. OP said they hadn't seen profit margins this high, and the reply indicates that it's not uncommon to see software even higher.

It's just a useful tidbit, related to the point they specifically quoted.

Re: TSMC Reports Q3 Earnings [pdf]

#24

Post by breck »

mousetree wrote: post #14
manuelabeledo wrote: post #6

Earlier quoted context omitted.

> those numbers are the highest margins I have ever seen ? It’s not unusual to see 70%+ margins in software products.

TSMC don't sell software products

Though perhaps you could say they sell derivatives of software products?

I'm assuming they write the best custom chip design software and that's their biggest competitive advantage (and then operational excellence and savvy business maneuvering et cetera). Though I know nothing about them just guessing as an outsider.

Re: TSMC Reports Q3 Earnings [pdf]

#25

Post by foobarian »

cgeier wrote: post #2

> Gross margin for the quarter was 60.4%, operating margin was 50.6%, and net profit margin was 45.8%. Still surprised how profitable TSMC is. Especially as this seems to be below the market expectations (their stock is still falling).

I wonder how capex is factored into this. If at some point they dropped a few tens of $B on the fab upgrade, and likely need to do so again soon, when does that get subtracted from profits?

Re: TSMC Reports Q3 Earnings [pdf]

#26

Post by pavlov »

sct202 wrote: post #17
cgeier wrote: post #2

> Gross margin for the quarter was 60.4%, operating margin was 50.6%, and net profit margin was 45.8%. Still surprised how profitable TSMC is. Especially as this seems to be below the market expectations (their stock is still falling).

Their stock is falling because of future demand issues coming up with the whole semiconductor industry. Just this week, expanded export bans to China were announced and are an uncertainty on how much volume will be impacted in the future, because no one knows what will get an exemption or not.

Also the long-term uncertainty of Taiwan's political situation will continue to weigh on TSMC's stock price.

For example, investors may be afraid that there might be some ominous signals coming at this week's National Congress of the Chinese Communist Party, held every five years.

Re: TSMC Reports Q3 Earnings [pdf]

#27

Post by lotsofpulp »

dis-sys wrote: post #19
ethbr0 wrote: post #16

Earlier quoted context omitted.

That's a partial accounting. The customer can sustainably afford to pay in proportion to the value it delivers to them , not TSMC. Apple has a finely tuned machine for turning performance into profits, and so can afford to pay more than others... and still have it make sense for Apple. If TSMC instead had a collection of automotive OEMs as their top-tier customers, this math wouldn't work. The point being... be in a…

Apple's gross margin is significantly lower than that of TSMC. everything else is just cheap talk.

A combination of profit margin, profit, and volatility are relevant. Apple’s lower profit margin is offset by the consistency of its profit margin and sheer size of the profit.

https://www.macrotrends.net/stocks/charts/AAPL/apple/net-pro...

https://www.macrotrends.net/stocks/charts/TSM/taiwan-semicon...

Re: TSMC Reports Q3 Earnings [pdf]

#28

Post by photochemsyn »

sct202 wrote: post #17
cgeier wrote: post #2

> Gross margin for the quarter was 60.4%, operating margin was 50.6%, and net profit margin was 45.8%. Still surprised how profitable TSMC is. Especially as this seems to be below the market expectations (their stock is still falling).

Their stock is falling because of future demand issues coming up with the whole semiconductor industry. Just this week, expanded export bans to China were announced and are an uncertainty on how much volume will be impacted in the future, because no one knows what will get an exemption or not.

The U.S. position on the entire Chinese semiconductor industry is getting increasingly ridiculous. It's not just chips, since China is the one country that's developed efficient monocrystalline silicon ingot production at scale, and solar panels made with that material are far superior to anything made in the USA currently.

The USA's financialized short-term thinking has resulted in a failure to develop basic technological infrastructure capability, and China is now in the lead - so the response is, stop trading with China on all things silicon? This is the Tonya Harding team's 'let's try to win by kneecapping our superior competition' mentality, and it's doomed to failure, if not in the short term, than certainly in the long term.

Re: TSMC Reports Q3 Earnings [pdf]

#30

Post by bismuthcrystal »

breck wrote: post #24
mousetree wrote: post #14

Earlier quoted context omitted.

TSMC don't sell software products

Though perhaps you could say they sell derivatives of software products? I'm assuming they write the best custom chip design software and that's their biggest competitive advantage (and then operational excellence and savvy business maneuvering et cetera). Though I know nothing about them just guessing as an outsider.

Pointless argument. At present time you could argue it for every company in the world. Boeing? Sells derivatives of CAD software, not airplanes.
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