Q1 2026 Taiwan Semiconductor Manufacturing Co Ltd Earnings Call (Chinese, English) Transcript
Key Points
- First quarter revenue increased by 8.4% sequentially in NT and 6.4% in USD, reaching $35.9 billion, slightly ahead of guidance.
- Gross margin improved by 3.9 percentage points to 66.2%, driven by cost improvements and higher capacity utilization.
- Advanced technologies (7-nanometer and below) accounted for 74% of wafer revenue, indicating strong demand for leading-edge process technologies.
- TSMC's 3-nanometer process technology contributed 25% of wafer revenue, with robust demand from HPC and AI applications.
- The company expects second quarter revenue to increase by 10% sequentially, with a year-over-year growth of 32% at the midpoint.
- Smartphone revenue decreased by 11% quarter-over-quarter, reflecting challenges in the consumer market.
- Automotive revenue decreased by 7%, indicating potential weakness in this segment.
- Days of inventory increased to 80 days, reflecting the ramp-up of new technologies and potential supply chain challenges.
- Gross margin is expected to face dilution from the ramp-up of overseas fabs and the initial ramp-up of 2-nanometer technology.
- Rising component prices and macroeconomic uncertainties, particularly due to the situation in the Middle East, may impact profitability.
(spoken in foreign language)
Good afternoon, everyone, and welcome to TSMC's first quarter 2026 earnings conference call. This is Jeff Su, TSMC's Director of Investor Relations and your host for today. TSMC is hosting our earnings conference call via live audio webcast through the company'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 first quarter 2026, followed by our guidance for the second quarter 2026.
Afterwards Mr. Huang, and TSMC's Chairman and CEO, Dr. C.C. Wei will jointly provide the company's key messages. Then we will open the line for the Q&A session.
As usual, I would like to remind everybody that today's discussions may contain
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