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TSMC revenue to drop as Apple faces a market slowdown

Published Jan 12th, 2023 10:01AM EST
TSMC plant
Image: Taiwan Semiconductor Manufacturing Co., Ltd.

TSMC has announced that its first-quarter revenue would drop as much as 5%, and it would cut annual investment as it expects softer demand due to a slowing global economy. The Taiwanese chipmaker is the main Apple processor supplier.

According to Reuters, despite the economic downturn and possible recession, Taiwan Semiconductor Manufacturing Company forecasts growth in the second half of this year.

“We forecast the semiconductor cycle to bottom sometime in first half and see a recovery in second half 2023,” CEO C.C. Wei said, adding the rebound would be boosted by new product launches such as artificial intelligence-enabled goods.

Due to this slowdown, TSMC said its capital expenditure this year would decrease to $32-36 billion from $36.3 billion in 2022.

“Given the near-term uncertainties, we continue to manage our business prudently and tighten up our capital spending where appropriate,” Huang said. “Our disciplined capex and capacity planning remain based on the long-term market demand profile.”

Interestingly enough, this report comes after several other stories highlighting that Apple wouldn’t have many products to unveil in 2023 due to its focus on the Mixed Reality headset. In addition, from the current product lineup, Apple is expected to sell fewer AirPods and Macs than expected. That said, DigiTimes also reported new high-end MacBook Pro would delay.

Previously, these machines have been delayed due to the difficulty of mass-producing 3nm chips. TSMC is responsible for this technology to manufacture the upcoming M2 Pro and M2 Max chips for Macs and the A17 Bionic processor for the iPhone 15 Pro models later this year.

With that, TSMC plans to be careful in 2023 in its investments:

“Given the near-term uncertainties, we continue to manage our business prudently and tighten up our capital spending where appropriate,” Huang said. “Our disciplined capex and capacity planning remain based on the long-term market demand profile.”

José Adorno
José Adorno Tech News Reporter

José is a Tech News Reporter at BGR. He has previously covered Apple and iPhone news for 9to5Mac, and was a producer and web editor for Latin American broadcaster TV Globo. He is based out of Brazil.