TSMC Q4 profit up 8 percent; aims to beat Intel, Samsung with new chips
Contract chip maker Taiwan Semiconductor Manufacturing Co. said its net profit grew by close to 8 percent year-over-year in the fourth quarter.
The company aims to “outcompete” Intel and Samsung in chips made with its upcoming 16-nanometer manufacturing process.
During the quarter, TSMC’s net profit reached NT$44.8 billion (US$1.4 billion) from NT$41.6 billion in the same period a year ago. Revenue was NT$145.8 billion, a year-over-year increase of close to 11 percent that met the company’s projections, TSMC reported on Thursday.
TSMC’s revenue has been steadily growing as a result of surging sales of smartphone and tablets. The company manufactures chips for companies like Qualcomm and Nvidia, with Apple also rumored to be one of its clients. About a third of TSMC’s revenue comes from smartphone and tablet processors.
Helping to drive revenue for TSMC is the company’s 28-nm chip manufacturing technology, which can make processors that are faster and more power-efficient. The 28-nm manufacturing process accounted for 34 percent of its chip making revenue in the fourth quarter.
”Now looking at 2014, we expect still another consecutive year of double digit growth in revenue,” said TSMC chairman Morris Chang in an earnings call. For the whole of 2013, the company saw revenue increase by 17.8 percent.
TSMC is optimistic in its outlook as it expects that the large number of wearable devices being developed by tech vendors will further drive demand for mobile chips. At the same time, the company is developing even more advanced chip manufacturing technology that’ll further improve its processors.
During Thursday’s earnings call, company executives said its 16-nm manufacturing process, slated to go into production later this year, will help it make chips that rival technology from Intel and Samsung.
”Recently Intel published some data that our 16 FinFET project has been behind and we think that the data is highly misleading,” Chang said. He later added, “Our grand alliance will outcompete Intel and Samsung,” referring to TSMC’s partnership for 16-nm manufacturing technology with its customers.
Intel is preparing a 14-nm process, and using it to build its new Broadwell processor. The company, however, said in October that production of its Broadwell chips will be pushed back until the first quarter of this year due to a manufacturing defect in the technology.
Samsung is also working on 14-nm chip making technology.