Author | Yesterday
As of the close of trading on January 13, 2022, TSMC had risen by 12.1% in 21 years and 15.69% in 22 years, significantly outperforming the S&P 500 Index (SPY: -2.2%), the Philadelphia Semiconductor Index (SOXX: -3.63%) and the Nasdaq 100 ETF (QQQ: -5.07%) in the same period. After more than 21 years of sideways shocks in October, TSMC's 22 years of opening red, stimulated by the unexpected financial report, last night's stock price rose by more than 11% to $145, a record high.
Benefiting from the protracted global chip supply shortage and the fact that chip demand remains strong, TSMC's 21Q4 revenue, net profit, and EPS all exceeded expectations. On Thursday, November 13, 2013, before the market, wafer foundry leader TSMC (TSM. N) Released 21Q4 performance report. According to the data, TSMC's Q4 revenue increased by 21.2% year-on-year to NT$438.189 billion (about US$15.855 billion), a record for six consecutive quarters; net profit increased 16.4% year-on-year to NT$166.232 billion (about US$6.015 billion), better than expected NT$161.4 billion; and diluted EPS increased 6.3% year-on-year to NT$6.41 (US$1.15 per ADR), higher than the estimated US$1.11.
At the same time, benefiting from the price increase of all product lines at the end of August last year, TSMC's interest rate situation has improved: TSMC 21Q4 gross profit margin was 52.7% (qoq +1.4%, yoy-1.3%), market estimate 52%, operating profit margin of 41.7% (qoq +0.2%, yoy-1.8%), net profit margin of 37.9% (qoq +0.5%, yoy-1.8%).
By process, advanced process technologies (7nm and above) contributed 50% to TSMC's revenue in the quarter. Among them, the 5nm process accounts for 23% (qoq+5%) and the 7nm process accounts for 34% (qoq-7%).
By product type, 21Q smartphones remained the largest contributor, accounting for 44% of total revenue, up 7% from the previous quarter, while cars accounted for 4% of total revenue, up 10% from the previous quarter, with strong growth.
From the perspective of the whole year, automotive chip revenue growth rate is the highest, up 51% year-on-year, which coincides with TSMC's previous forecast to increase the production of 60% microcontroller (MCU) chips in 21 years to alleviate the continued shortage of automotive chips. In 20 years, TSMC produced about 70% of the world's automotive MCU chips, but due to the long and complex automotive chip supply chain, the company only supplied 15% of the automotive chip production capacity. Although TSMC has tried its best to alleviate the shortage of production capacity in 21 years, it will still take several quarters to transmit to the OEM plant: according to Susquehanna Financial Group, the delivery time of semiconductor components in December 2021 was extended to 25.8 weeks, an increase of 6 days from the previous month, a new high since 2017, and the delivery time of almost all categories of products is elongating, of which microcontrollers (MCUs) and power management chips (PMIC) have the longest delivery time.
The second-highest-growth business in 21 years was high-performance computing (HPC), up 34% year-on-year. As the main customers of TSMC's HPC business, AMD and NVIDIA have benefited from the transformation of the digital economy, the background of vigorous data center development, and the continuous increase in data center business revenue, which has also boosted the rapid growth of TSMC's HPC business, and TSMC's Q4 earnings report has also set the tone for AMD and NVIDIA's performance.
In addition, all of AMD's main products (PC + data center + next-generation game consoles) are based on TSMC's 7 nm process, and by the first half of 22, AMD data center CPUs and other PC products will carry out process upgrades, and gradually switch to TSMC's 5nm process. Under the trend of process upgrading, in the future, the proportion of TSMC's 5nm revenue will continue to increase, and the proportion of 7nm will decline.
Due to the strong demand for 5G, HPC and special processes, TSMC's capital expenditure reached a record high of $30.04 billion in 21 years, of which 80% was used for 3, 5, and 7nm processes, 10% for advanced packaging, and 10% for special processes.
Looking ahead, TSMC 22Q1 revenue is expected to be $16.6-17.2 billion, at least 5% higher than consensus expectations; gross margin of 53%-55%, market estimate of 51.8%; operating margin of 42%-44%, market estimate of 41%. At the same time, TSMC also said that in 2022, TSMC will usher in another growth year, and it is expected that the long-term return on net assets will be higher than 25%, and the average annual CAGR in US dollar terms in the next few years will be 15%-20%, higher than the previous estimate.
In addition, TSMC expects that production capacity will continue to be tight in 2022, the supply will remain higher inventory, and at the same time continue to deploy advanced, special processes and advanced packaging capacity (the expansion of the 28nm plant in Nanjing, the United States, the 5nm plant in Arizona, the 22/28nm plant in Kumamoto, Japan, the 7/28nm plant in Kaohsiung, Taiwan, and the 3nm plant in Zhuke Baoshan, Taiwan, etc.), and the capital expenditure is expected to be 40-44 billion US dollars in 22 years, an increase of more than 10 billion US dollars compared with 21 years. It also matches the three-year 100 billion-dollar capital expenditure plan announced in 20 years, suggesting that the exuberant demand for chips that has caused months of supply chain tightening will continue for years. In order to ensure chip supply, dozens of customers such as Apple, AMD, NVIDIA, qualcomm and other dozens of customers paid to TSMC, can provide sufficient financial support for TSMC's large-scale expansion of production capacity. In terms of advanced process research and development, TSMC said that the development of 3nm chips is on track and is expected to be mass-produced in the second half of the year.
Note: This article is original by the US stock research agency team, please indicate the source when reprinting, thank you!