Stocks of Taiwan Semiconductor surge despite weaker guidance for Q4 earnings

Even though Taiwan Semiconductor’s fourth-quarter guidance was weak, shares are climbing even as Taiwan Semiconductor shares rise.

Video Transcript

DAN HOWLEY TSMC has announced their Q4 earnings. They gave weaker guidance for the next quarter than they expected. They estimated that revenue would be between 16.7 billion to 17.5 billion. Analysts had hoped for 17.9 billion. Analysts wanted 17.9 billion. Meanwhile, the foundry industry is expected to shrink by 3%. According to TSMC revenue will drop between the low single digits and mid single digits compared to the same time last year.

They’ll pick up the pieces again in the second half of the year. While everyone else is having a bad year, they will be able to turn the tide and finish the year strong. Their outlook is positive. They claim they are cutting costs to improve profitability.

This is something we have seen across the entire semiconductor industry. Whether it’s Intel or AMD or Nvidia, the foundries are trying to figure how they can return to profitability or growth. Not profitability, but meaningful growth.

DAVE BRIGGS They can’t control all of it. In a commentary, their CEO said, “We continue to observe softness at the consumer end market segment.” He spoke about the supply chain snarls being still the main problem in the industry. I had no idea that we weren’t all the way back. He said, “We expect revenue to fall mid to high single figures, but then, yes. Second half of this year, things will turn around as the supply chain improves and then they start popping.” Keep calm.