US-listed shares of Taiwan Semiconductor Manufacturing Co. ($TSM) climbed intraday Thursday after the chipmaker issued an upbeat fourth-quarter revenue guidance, reflecting robust demand across artificial intelligence and smartphones. For the ongoing quarter, the Apple ($AAPL) supplier is projecting revenue between $26.1 billion and $26.9 billion, representing a 13% sequential increase and a 35% year-over-year gain at the midpoint, Chief Financial Officer Wendell Huang said on a conference call.
The consensus forecast was for $25.53 billion in fourth-quarter sales. Revenue rose to 759.69 billion New Taiwanese dollars ($23.64 billion) for the three months ended Sept. 30 from 546.73 billion New Taiwanese dollars a year ago. It beat the 750.21 billion New Taiwanese dollar estimate modeled by analysts. Earnings per share advanced to 12.54 New Taiwanese dollars from 8.14 New Taiwanese dollars year over year, surpassing the Street's projection for 11.55 New Taiwanese dollars.
TSMC's New York Stock Exchange-listed shares climbed 12% in Thursday trade. "Our business in the third quarter was supported by strong smartphone and AI-related demand for our industry-leading 3 (nanometer) and 5nm technologies," Huang said in a statement. "Moving into the fourth quarter 2024, we expect our business to continue to be supported by strong demand for our leading-edge process technologies." Wedbush Securities noted that Taiwan Semiconductor's strength was driven by high performance computing and "largely AI." The firm reiterated an outperform rating and lifted its price target to 1,225 New Taiwanese dollars from 1,175 New Taiwanese dollars on TSMC's stock. These results come after Dutch chip equipment maker ASML ($ASML) flagged "customer cautiousness" heading into 2025. "While we continue to view AI as a key driver of the industry recovery with potential upside, we see other segments recovering more slowly than anticipated," ASML Chief Executive Christophe Fouquet said during a conference call.
"The recovery will extend well into 2025, which is leading to customer cautiousness and some pushouts in their investments." Softness in mobile and personal computer markets was contributing to a slower-than-expected recovery in ASML's logic division. Logic chips enable electronic devices to complete a task. Price: 211.91, Change: +24.43, Percent Change: +13.03.