TSMC: 2023 Guidance Reduction Excuse To Take Profit? Guidance Also Affirmed Long-Term Bullishness

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Equity Long-Short, Semiconductors, Fabricated Knowledge

Douglas O'Laughlin

Equity Long-Short, Semiconductors

Fabricated Knowledge

Learn more about the world's most important manufactured product. Meaningful insight, timely analysis, and an occasional investment idea.

Equity Bottom-Up

Taiwan Semiconductor (TSMC) - ADR / Equity Bottom-Up

Taiwan Semiconductor (TSMC) - ADR (TSM US)

<ul>
<li>TSMC reported earnings. They beat Q2 estimates, but importantly they guided down Q3 and FY 2023 estimates.</li>
<li>The Q2 beat was widely expected regarding revenue, given that TSMC reports monthly revenue, but the Q3 guide was not.</li>
<li>The midpoint of the guidance has the year-over-year decline decelerating, which I didn’t expect. Moreover, the -10% annual guide throws some water on the second-half recovery. Yes, the second half will be higher than the first, but the recovery is much more muted than historical. And what’s more, margins are looking worse for N3 than a typical node.</li>
</ul>


TSMC reported earnings. They beat Q2 estimates, but importantly they guided down Q3 and FY 2023 estimates.
The Q2 beat was widely expected regarding revenue, given that TSMC reports monthly revenue, but the Q3 guide was not.
The midpoint of the guidance has the year-over-year decline decelerating, which I didn’t expect. Moreover, the -10% annual guide throws some water on the second-half recovery. Yes, the second half will be higher than the first, but the recovery is much more muted than historical. And what’s more, margins are looking worse for N3 than a typical node.


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