TSMC, the world leader in semiconductors, presented its results for the last quarter of 2021 on January 13. In this period of chip shortages, the sector leader is doing wonderfully with revenues up 18.5% over the year 2021 to reach $57 billion.
Still more investments
A large part of this money must be reinvested in 2022. TSMC had announced an expansion plan for 100 billion dollars over the next few years. A promise to be taken seriously, the company plans 44 billion dollars of investment for the year to increase its production capacity by 47% and to continue to develop new technologies.
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A $12 billion factory is under construction in Phoenix, USA, another is in Japan. The production capacity of the factories present in Nanjing, China and Taiwan must also be increased. A project could also arise in Germany.
These investments must meet the demand for chips and mainly for the less advanced ones, the most difficult to find in these times of crisis in the sector. Demand from the automotive sector, the most affected by the lack of parts, increased by 51% in 2021.
TSMC has already increased its production capacity by 60% for automotive chips. It represents, however, only 4% of TSMC’s annual revenue. Apple and smartphones, the other chip-eating domain equivalent to 44% of TSMC’s income.
Samsung, Intel and TSMC, the three sector leaders have promised the three of them $146 billion in investments during the year 2021. These announcements, with the astronomical sums on the table, do not necessarily reassure investors. The semiconductor market took light in the year 2021 owing to the shortage. This situation is recent for a sector which actually experiences regular phases of over and under production.
TSMC safe from overproduction?
A possible overcapacity of TSMC remains a worrying prospect. The general manager of the Taiwanese company, CC Wei, dismissed the question according to Reuters, “ Even if a correction were to occur, we believe it could be less volatile for TSMC due to our technology leadership position and the structural megatrend. “. The money has to finance new technologies, which are mainly reduced to ever smaller and more efficient chips.
Strengthened by this privileged position, the company is approaching 2022 with complete peace of mind. These forecasts for the first quarter, from January to March, attest to this. TSMC expects a turnover of 17.2 billion dollars, an increase of 28 to 33% of its income compared to 2021. Over the whole year, the most valued Asian company hopes for 20% growth.