Q2 2025 Taiwan Semiconductor Manufacturing Co Ltd Earnings Call (Chinese, English) Transcript
Key Points
- Second-quarter revenue increased by 17.8% sequentially in US dollar terms, reaching $30.1 billion, exceeding guidance.
- Advanced technologies (7-nanometer and below) accounted for 74% of wafer revenue, showcasing strong demand for cutting-edge processes.
- TSMC's AI and HPC-related demand remains robust, contributing significantly to revenue growth.
- The company plans to invest $165 billion in advanced semiconductor manufacturing in the US, indicating strong future growth potential.
- TSMC's N2 and A16 technologies are on track, with N2 expected to enter volume production in the second half of 2025, promising future revenue streams.
- Gross margin decreased by 0.2 percentage points sequentially to 58.6%, impacted by unfavorable foreign exchange rates and overseas fab costs.
- The company anticipates continued gross margin dilution from overseas fabs, with a forecasted impact of 2% to 4% annually over the next five years.
- Foreign exchange rate fluctuations pose a significant risk, with a 1% appreciation of the NT dollar against the US dollar reducing gross margin by about 40 basis points.
- TSMC's fourth-quarter revenue is expected to decline, reflecting a cautious outlook due to potential tariff impacts and macroeconomic uncertainties.
- The company faces challenges in narrowing the supply-demand gap for advanced nodes like N3 and N5, indicating potential capacity constraints.
(spoken in foreign language)
Good afternoon, everyone, and welcome to TSMC's second-quarter 2025 earnings conference and conference call. This is Jeff Su, TSMC's Director of Investor Relations and your host for today.
Today's event is being webcast live through TSMC's website at www.tsmc.com, where you can also download the earnings release materials. If you're joining us through the conference call, your dial-in lines are in listen-only mode.
The format for today's event will be as follows. First, TSMC's Senior Vice President and CFO, Mr. Wendell Huang, will summarize our operations in the second quarter 2025, followed by our guidance for the third quarter 2025. Afterwards, Mr. Huang and TSMC's Chairman and CEO, Dr. C.C. Wei, will jointly company's key messages. Then we will open both the floor and the line for the question-and-answer session.
As usual, I would like to remind everybody that today's discussions may contain
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