LONDON Taiwan Semiconductor Manufacturing Co. nearly doubled net profits during its first quarter ended March 31 to $1 billion compared with the same period last year, citing better-than-expected demand for personal computers as one of the main drivers.
Revenues at the world’s largest chip foundry were up 39 percent to $2.41 billion compared with the corresponding period of 2005.
The company said its net operating profit for the first quarter was $966.8 million, a rise of 92 percent compared to what was achieved in the first quarter last year.
"The first quarter was better because of better-than-expected extra demand for personal computers," said Lora Ho, the company's vice president and chief financial officer.
''Due primarily to seasonality and a weaker US dollar, our first quarter business had declined as we expected, although revenue surpassed our guidance,'' said Ho. ''Going forward, we expect the demand to increase for most of the application segments and the currency exchange rate impact to be less pronounced,'' Ho added.
Guidance for the second quarter was for sales to be between NT$79 billion ($2.46 billion) and NT$81 billion ($2.53 billion), while gross profit margin to be between 47 percent and 49 percent.
The company said advanced processes, that is 0.13-micron and below, accounted for 49 percent of wafer revenues while revenues from 90-nanometer process technology represented a fifth of total wafer sales.
Gross margin declined from 49.1 percent in the previous quarter to 47.4 percent in the first quarter, with the 3.3 percent depreciation in US dollars an important factor.
Operating margin was 39.9 percent compared to 42.2 percent in the previous quarter, while net margin increased slightly to 42.2 percent from 41.8 percent quarter over quarter.
Earlier this week, local rival United Microelectronics Corp., said revenues climbed 20 percent year-on-year to NT$24.38 billion (about $610 million) and the company made an operational profit of NT$85 million (about $2.1 million) in the company’s first quarter financial results, which were widely interpreted to indicate a return to form.