TSM Stock: Taiwan Semiconductor Sees More Weakness Ahead

Taiwan Semiconductor Manufacturing (TSM), the world’s largest contract chipmaker, on Thursday posted mixed results for the first quarter and gave a weak outlook for the current period. Still, TSM stock rose in early trading.

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Taiwan Semiconductor, better known as TSMC, earned $1.31 per U.S. share on sales of $16.72 billion in the March quarter. Analysts polled by FactSet had predicted earnings of $1.21 a share on sales of $17 billion. On a year-over-year basis, TSMC earnings dropped 3% while sales declined 5%.

For the current quarter, TSMC forecast revenue of $15.2 billion to $16 billion. The midpoint of $15.6 billion is below Wall Street’s target of $16.13 billion. In the year-earlier period, TSMC generated $17.87 billion in sales.

“Our first-quarter business was impacted by weakening macroeconomic conditions and softening end-market demand, which led customers to adjust their demand accordingly,” Chief Financial Officer Wendell Huang said in a news release.

He added, “Moving into second-quarter 2023, we expect our business to continue to be impacted by customers’ further inventory adjustment.”

TSM Stock Is On IBD Tech Leaders List

In premarket trading on the stock market today, TSM stock climbed 0.5% to 87.67.

TSM stock ranks sixth out of 30 stocks in IBD’s semiconductor manufacturing industry group, according to IBD Stock Checkup. Taiwan Semiconductor has an IBD Composite Rating of 94 out of 99.

IBD’s Composite Rating is a blend of key fundamental and technical metrics to help investors gauge a stock’s strengths. The best growth stocks have a Composite Rating of 90 or better.

Further, TSM stock is on the IBD Tech Leaders list.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.

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