Taiwan Semiconductor Manufacturing Company Limited (TSMC) has announced its financial results for the first quarter of 2024. The company reported a 5.3% sequential decrease in revenue in NTD (New Taiwan Dollar) or 3.8% in USD (United States Dollar), primarily due to smartphone seasonality. However, continued high-performance computing (HPC)-related demand partially offset the impact.

TSMC's gross margin saw a slight increase of 0.1 percentage point sequentially, reaching 53.1%. This was attributed to changes in product mix driven by smartphone seasonality. However, a less favorable foreign exchange rate limited the improvement. Tighter expense controls helped lower the total operating expenses to 11.1% of net revenue, below the 12% implied in the first quarter guidance. As a result, the company's operating margin increased by 0.4 percentage points to 42%.

In terms of technology, TSMC's 3-nanometer process technology contributed 9% of wafer revenue in the first quarter. Advanced technologies, including 7-nanometer and below, accounted for 65% of wafer revenue. The 5-nanometer process accounted for 37% of revenue, while the 7-nanometer process accounted for 19%.

Analyzing revenue contribution by platform, HPC was the top performer, experiencing a 3% quarter-over-quarter increase and accounting for 46% of the first quarter's revenue. Smartphone revenue, on the other hand, decreased by 16% and accounted for 38% of revenue. The Internet of Things (IoT) segment saw a 5% increase in revenue and contributed 6% to the total. The automotive sector remained flat at 6%, and the data center enterprise (DCE) sector experienced a significant increase of 33%, representing 2% of the revenue.

Overall, TSMC reported an earnings per share (EPS) of TWD8.7 and a return on equity (ROE) of 25.4% for the first quarter of 2024. The company remains cautiously optimistic about the market outlook for the second quarter. TSMC's Chief Financial Officer, Mr. Wendell Huang, expressed confidence in the company's ability to weather challenges and capitalize on growing demand for advanced technologies.

As TSMC continues to be one of the world's leading semiconductor manufacturers, its performance and strategic investments in advanced technologies have positioned it well in the highly competitive industry. These results reaffirm its commitment to innovation and its capability to adapt to market trends, ensuring its growth and success in the global semiconductor market.