Home Computing TSMC revenue soars 60% on AI demand

TSMC revenue soars 60% on AI demand

Almost all AI innovators are working with the chipmaker to address the rapidly growing AI-related demand for energy-efficient computing power, the CEO said

  • By Lisa Wang / Staff Reporter

Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported about 60 percent annual growth in revenue for last month, benefiting from rapidly growing demand for artificial intelligence (AI) and high-performance computing applications.

Revenue last month expanded to NT$236.02 billion (US$7.28 billion), compared with NT$147.9 billion in April last year, the second-highest level in company history, TSMC said in a statement. On a monthly basis, revenue surged 20.9 percent, from NT$195.21 billion in March.

As AI-related applications continue to show strong growth, TSMC expects revenue to expand about 27.6 percent year-on-year during the current quarter to between US$19.6 billion and US$20.4 billion.

Photo: Mike Kai Chen, Bloomberg

That would mean a sequential growth of 6 percent, the chipmaker told investors last month.

“Almost all the AI innovators are working with TSMC to address the insatiable AI-related demand for energy-efficient computing power,” TSMC CEO C.C. Wei (魏哲家) told an investors’ conference.

The chipmaker forecasts that server AI processor revenue would more than double this year from last year and account for a low-teens percentage of its total revenue this year, Wei said.

As a majority of AI accelerators and graphics processors utilize its advanced process technologies, such as 5-nanometer or 4-nanometer technology and beyond, revenue this quarter would be supported by strong demand for 5-nanometer and 3-nanometer technologies, TSMC said.

That would partly offset weakness in smartphone chip demand during the slack season and sagging demand for vehicle chips on excessive inventory, the chipmaker said.

Last quarter, 5-nanometer technology was the largest revenue contributor, accounting for 37 percent of the chipmaker’s total revenue, while 3-nanometer technology made up 9 percent, TSMC said.

The Hsinchu-based company said all its AI chip customers are working on further technology migration to energy-efficient 2-nanometer technology, considering that AI servers consume much more power than general-purpose models.

TSMC is scheduled to ramp up 2-nanometer technology in the second half of next year.

In a separate statement, TSMC said its board of directors has approved the distribution of a NT$4 per share cash dividend for the first quarter of this year, higher than the NT$3.5 a share paid for the final quarter of last year.

The company made NT$225.49 billion in net profit, or NT$8.7 per share, in the first quarter of this year. TSMC usually pays 70 percent of its free cash flow in a year as a cash dividend.

However, as it is harvesting from the heavy investment in the past few years, the chipmaker expects its cash dividend to “steadily increase” from a sustainable level in the past few years.

The cash dividend distribution is subject to the final approval of shareholders during the annual general meeting scheduled for June 4.

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