Investing.com – Taiwan Semiconductor stock (NYSE:TSM) traded 2.7% higher in Thursday’s premarket as the chipmaker lifted its annual forecast after another strong quarter for its chip-making factories.
The company raised its revenue growth forecast for 2021 to about 24% compared to its previous estimate of above 20%, citing sustained strong demand from various consumer industries.
The world’s largest contract manufacturer of chips said it expects revenue of as much as $15.7 billion in the three months ended December. Gross margin could come in as high as 53%, it said
TSMC supplies components to Apple (NASDAQ:AAPL) and rivals like Intel (NASDAQ:INTC) as well. Demand for its chips that go into cars, mobiles, laptops and gadgets of various hues has been at a historic high for more than a year due to a confluence of factors.
The pandemic has driven a combination of work-from-home and work-from-office lifestyle, leading corporates and individuals to equip their rooms with more devices.
While demand has boomed, supplies have remained constrained,not least because factories in China, Vietnam and other southeast Asian hubs have been shut for extended periods to contain the spread of the virus.
Such shortages are making themselves felt even for the biggest buyers. Apple is preparing to cut shipments of its new iPhone 13 by 10% due to component shortages, Bloomberg reported this week. In Europe on Thursday, industrial group CNH said it would shut several of its European agricultural, commercial vehicle and powertrain manufacturing facilities temporarily due to the same factors.
“We expect TSMC’s capacity to remain very tight in 2021 and throughout 2022,” Chief Executive Officer C.C. Wei said on a conference call, according to Bloomberg.
The company’s third-quarter net profit jumped about 14% to T$156.25 billion ($5.6 billion), beating expectations. Net sales climbed around 16% to T$414.67 billion, falling just short of estimates.