TSMC Forecasts 10% Reduction In 2023 Sales

Taiwanese chipmaker TSMC forecast a drop of around 10% in 2023 sales on Thursday and lower investment spending as global economic woes dent demand for chips used in everything from cars to cellphones, Sarah Wu and Yimou Lee reported for Reuters.

Photo Insert: Given the AI demand surge, TSMC said it has been hard to fulfill customer needs and plans to boost advanced packaging capacity as quickly as possible.

The world's largest contract chipmaker said that high demand for artificial intelligence (AI) and its position as the largest manufacturer of AI chips has not offset broader end-market weakness as the global economy recovers more slowly than it had expected.

"The short-term frenzy about the AI demand definitely cannot extrapolate for the long term. Neither can we predict the near future - meaning next year - how the sudden demand will continue or flatten out," TSMC chairman Mark Liu said after the company reported a 23% fall in second-quarter profit.

Given the AI demand surge, TSMC said it has been hard to fulfill customer needs and plans to boost advanced packaging capacity as quickly as possible.

The company estimated investment spending for this year at the lower end of a previous forecast of $32-$36 billion and expects a slower increase in the next few years after dramatic increases in recent years.

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