By Kosaku Narioka


Taiwan Semiconductor Manufacturing Co.'s fourth-quarter net profit fell from a year earlier as revenue from chips used in Internet of Things decreased and margins deteriorated.

The world's largest contract chip maker said Thursday that net profit dropped 19% from a year earlier to 238.71 billion new Taiwan dollars (US$7.56 billion) for the three months ended Dec. 31. That exceeded the estimate of NT$224.67 billion in a poll of analysts by S&P Global Market Intelligence. Net profit increased 13% from the third quarter.

Fourth-quarter revenue stayed flat from a year earlier at NT$625.53 billion.

The chip maker has been facing a sales slump in recent months as clients cut back on their inventory following a pandemic-driven surge in demand for chips used in electronics equipment.

TSMC's operating profit margin deteriorated to 41.6% in the fourth quarter, down 10.4 percentage points from a year earlier and 0.1 percentage point lower than in the previous quarter.

For the first quarter, TSMC projects that revenue will decrease to a level between US$18.0 billion and US$18.8 billion from US$19.62 billion in the fourth quarter. It forecasts that its operating profit margin will stay in a 40% to 42% range.

TSMC expects capital expenditures in 2024 to be between US$28 billion and US$32 billion, compared with the US$30.45 billion it spent in 2023.

Fourth-quarter revenue from Internet of Things dropped 29% from the previous quarter, while revenue from high-performance computing increased 17% and revenue from smartphones rose 27%.

TSMC said revenue from customers in North America accounted for 72% of the total revenue, up from 69% in the third quarter, while revenue from China made up 11%, down from 12% in the previous quarter.


Write to Kosaku Narioka at kosaku.narioka@wsj.com


(END) Dow Jones Newswires

01-18-24 0228ET