TSMC cuts capex on inflation worries after posting 80% profit jump
Taiwanese chipmaker TSMC's (US.TSM) quarterly profit surged 80% on strong sales of its chips used in data centres and electric cars, but the company cut its annual investment budget by at least 10% and struck a more cautious tone on upcoming demand. TSMC's dominance in making some of the world's most advanced chips for high-end customers such as Apple Inc (US.AAPL) and Qualcomm Inc (US.QCOM) had shielded it from the downturn flagged by chipmakers including AMD (US.AMD) and Micron Technology Inc (US.MU).
But Taiwan Semiconductor Manufacturing Co Ltd (TSMC) flagged on Thursday challenges from rising inflationary costs next year and cut its capital expenditure for 2022 to around $36 billion. It comes as the chip industry is dealing with weak demand, spurred by decades-high inflation, rising interest rates and COVID 19-related lockdowns in China that have hurt the PC and smartphone market as businesses and consumers rein in expenses.