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💎Taiwan Semiconductor Manufacturing Company $TSM-1.0% in 2023 and their outlook for 2024! Shares are up more than 7%! 🚀

The year 2023 was a busy one for semiconductors, with demand growing mostly in the automotive industry during the year, and in the last quarter this growth spread to other areas of the business. Margins were lower due to 3nm technology. The company does not plan to spend more on investments in 2024 than last year. The company will focus spending mostly on new technologies. However, now begins the stretch for the company to benefit from artificial intelligence, which it has been investing in for several years.



$125.37 -$1.32 -1.04%
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TSMC's Q4 2023 earnings:

EPS: $1.44 versus estimate of $1.37

Revenue: $19.62 billion vs. estimate of $19.45 billion

So, for revenue, this represents a 1.5% decrease from the previous year, but a 13.6% increase from the previous quarter. Gross margin was 53%, operating margin was 41.6% and net margin was 38.2%.

For Q1 2024, TSMC expects:

Revenues in the range of $18.0-18.8 billion vs. estimate of $18.26 billion.

Semiconductor demand is expected to rebound in 2024.

Gross margin is expected to be between 52% and 54%. Operating margin is expected to be between 40% and 42%.

$TSM-1.0% announced that the opening of its second manufacturing facility in Arizona is facing delays, pushing back the original planned date from 2026 to between 2027 and 2028. This delay is attributed to a leading labor shortage and rising costs, which was disclosed today during the earnings conference call! 🏭

But let's not forget the geopolitical risk, which is much more imminent with this company after the recent elections in Taiwan! There are currently reports that China is starting a massive military exercise around the entire island.

Personally, I do not think that China would commit such a thing, but we shall see.

How do you feel about this company that supplies the whole world with semiconductors? How much of a threat do you see in a potential conflict with China?

Can you elaborate on why the risk should be even greater than before the elections? China doesn't like the results or that they're having an election at all? ;)

The president will be replaced by a vice president from the same party. The comrade will be throwing money at exercises again for a while and his GDP will certainly not grow because of it. On the other hand, in case of conflict, it is estimated to drop ca 10%.

In today's movement you can see quite well what the market prefers, on the one hand the prospect of growth of up to 20% or repeated provocations that have less and less meaning.

Exactly, China doesn't like having elections there and they certainly don't like who won them. The next election isn't for 4 years, so they'll still have a lot to deal with. If Chou Jou-i, who is pushing for improved relations with Beijing, had won, they would certainly have slept better. As I write, I don't think there will be any conflict either, but I have to mention it as a risk.