Taiwan Semi Rises on Q1 Beat – TipRanks Financial Blog

Taiwan Semiconductor (NYSE:TSM) shares are ticking higher today after the semiconductor major reported better-than-anticipated numbers for the first quarter.

TSM’s Q1 Results

Revenue increased by 12.9% year-over-year to $18.87 billion, outpacing expectations by $560 million. The Earnings per American Depository Receipt (EPADR) of $1.38 exceeded consensus by $0.08. However, sequentially, the company experienced declines in both its top and bottom lines.

During the quarter, TSM generated nearly 65% of its total wafer revenue from the sales of 7-nanometer and more advanced technologies. TSM’s first-quarter results were influenced by seasonality in smartphone sales. However, the company anticipates that there will be robust demand for its 3-nanometer and 5-nanometer offerings in the second quarter.

TSM’S Future Outlook

Looking ahead to Q2, TSM forecasts revenue in the range of $19.6 billion to $20.4 billion, with operating profit margin expected to hover between 40% and 42%. In Q1, the company achieved an operating profit margin of 42%.

Importantly, TSM’s resilient first-quarter performance indicates increased demand for advanced chips due to the AI boom. However, investor confidence in the semiconductor sector dipped yesterday following ASML’s (NASDAQ:ASML) (DE:ASMF) weak order trends in its first-quarter results.

What Is the Target Price for TSM Stock?

TSM’s share price has rallied by nearly 60% over the past year. Overall, the Street has a Strong Buy consensus rating on the stock, alongside an average TSM price target of $154.14. However, analysts’ views on TSM could see changes following today’s earnings report.

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