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Taiwan Semiconductor Manufacturing Co Operating Margin %

: 49.07% (As of Jun. 2022)
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Operating Margin % is calculated as Operating Income divided by its Revenue. Taiwan Semiconductor Manufacturing Co's Operating Income for the three months ended in Jun. 2022 was $8,855 Mil. Taiwan Semiconductor Manufacturing Co's Revenue for the three months ended in Jun. 2022 was $18,044 Mil. Therefore, Taiwan Semiconductor Manufacturing Co's Operating Margin % for the quarter that ended in Jun. 2022 was 49.07%.

Good Sign:

Taiwan Semiconductor Manufacturing Co Ltd operating margin is expanding. Margin expansion is usually a good sign.

The historical rank and industry rank for Taiwan Semiconductor Manufacturing Co's Operating Margin % or its related term are showing as below:

TSM' s Operating Margin % Range Over the Past 10 Years
Min: 34.83   Med: 38.53   Max: 44.71
Current: 44.71


TSM's Operating Margin % is ranked better than
97.46% of 904 companies
in the Semiconductors industry
Industry Median: 11.39 vs TSM: 44.71

Taiwan Semiconductor Manufacturing Co's 5-Year Average Operating Margin % Growth Rate was 0.80% per year.

Taiwan Semiconductor Manufacturing Co's Operating Income for the three months ended in Jun. 2022 was $8,855 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2022 was $29,482 Mil.


Taiwan Semiconductor Manufacturing Co Operating Margin % Historical Data

The historical data trend for Taiwan Semiconductor Manufacturing Co's Operating Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Taiwan Semiconductor Manufacturing Co Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Operating Margin %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 39.56 37.20 34.83 42.32 40.95

Taiwan Semiconductor Manufacturing Co Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Operating Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 39.14 41.24 41.71 45.57 49.07

Competitive Comparison

For the Semiconductors subindustry, Taiwan Semiconductor Manufacturing Co's Operating Margin %, along with its competitors' market caps and Operating Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Taiwan Semiconductor Manufacturing Co Operating Margin % Distribution

For the Semiconductors industry and Technology sector, Taiwan Semiconductor Manufacturing Co's Operating Margin % distribution charts can be found below:

* The bar in red indicates where Taiwan Semiconductor Manufacturing Co's Operating Margin % falls into.



Taiwan Semiconductor Manufacturing Co Operating Margin % Calculation

Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.

Taiwan Semiconductor Manufacturing Co's Operating Margin % for the fiscal year that ended in Dec. 2021 is calculated as

Operating Margin %=Operating Income (A: Dec. 2021 ) / Revenue (A: Dec. 2021 )
=23424.338963749 / 57208.061092471
=40.95 %

Taiwan Semiconductor Manufacturing Co's Operating Margin % for the quarter that ended in Jun. 2022 is calculated as

Operating Margin %=Operating Income (Q: Jun. 2022 ) / Revenue (Q: Jun. 2022 )
=8854.6645430009 / 18043.529789311
=49.07 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Taiwan Semiconductor Manufacturing Co  (NYSE:TSM) Operating Margin % Explanation

Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.


Be Aware

Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia’s Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.


Taiwan Semiconductor Manufacturing Co Operating Margin % Related Terms

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Taiwan Semiconductor Manufacturing Co Business Description

Taiwan Semiconductor Manufacturing Co logo
Address
No. 8, Li-Hsin Road 6, Hsinchu Science Park, Hsinchu, TWN, 300-096
Taiwan Semiconductor Manufacturing Company, or TSMC, is the world's largest dedicated chip foundry, with over 58% market share in 2020 per Gartner. TSMC was founded in 1987 as a joint venture of Philips, the government of Taiwan, and private investors. It went public as an ADR in the U.S. in 1997. TSMC's scale and high-quality technology allow the firm to generate solid operating margins, even in the highly competitive foundry business. Furthermore, the shift to the fabless business model has created tailwinds for TSMC. The foundry leader has an illustrious customer base, including Apple, AMD and Nvidia, that looks to apply cutting-edge process technologies to its semiconductor designs.

Taiwan Semiconductor Manufacturing Co Headlines

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