HSINCHU, Taiwan --Taiwan Semiconductor Manufacturing Co. Ltd. here today reported net sales dropped 33.5% to NT$26.3 billion ($754 million) in the second quarter from NT$39.5 billion ($1.13 billion) in the prior three-month period.
TSMC's factory capacity utilization fell to 44% from about 70% in the first quarter this year and 102% in Q2 last year. The foundry company also predicted that its foundry utilization would fall to the "upper 30% range" in the current third quarter, but TSMC also said it believes revenues reached their low point in the current slump during May and June, and it now expects a recovery to continue in the second half of 2001.
The world's largest silicon foundry company said its net income was NT$312 million ($8.9 million) in the quarter, ended June 30, compared to NT$8.4 billion ($241 million) in Q1 this year.
Shipments of processed wafers sequentially fell 36% in the second quarter from the prior period as demand for foundry services continued to fall in the current recession, TSMC said.
However, the Taiwan foundry giant is not planning to cut back its capital expenditures this year from its current plans of $2.2 billion. The company said it plans to spend more than 50% of these funds on 300-mm wafer fabs for additional capacity in 2002 and beyond.
By the end of 2001, TSMC expects to be managing total capacity of 4.41 million eight-inch equivalent wafers on an annual basis, up 29% from 3.4 million in 2000. This total installed fab capacity includes joint-venture plants as well as wholly-owned TSMC facilities.
On an encouraging note, TSMC said it's book-to-bill ratio has "hovered around 1 for four months since April." The company added that "this is a reasonably solid sign that the bottom has been reached."
In fact, TSMC said May and June appear to be the low point in the slump for revenues, and it is expecting sequential growth in the months ahead during the second half of 2001. The third quarter operating profit and net income should not be lower than Q2, said the company in its guidance.
