Taiwan Semiconductor Manufacturing Co. , a key chip supplier to Apple Inc., plans to spend more than ever on developing advanced chips and building plant capacity, capitalizing on a surge in semiconductor demand that has led to a shortfall in global supplies.
The world’s largest contract chip maker will raise capital expenditures to between $25 billion and $28 billion in 2021, executives said on a Thursday earnings call, at least a 47% year-over-year increase.
“It’s a monster number,” said Brett Simpson, partner at London-based technology research firm Arete Research. “That’s a signal about how they think about the economic recovery and also the confidence they have in their long-term growth.”
TSMC also reported record quarterly revenue and net profit Thursday, bolstered by high demand from 5G phones as well as the expanding use of electronics required for remote work during the Covid-19 pandemic.
Net profit increased to 142.77 billion New Taiwan dollars, the equivalent of $5.1 billion, up 23% compared with the same period a year earlier, and exceeded expectations from analysts polled by S&P Global Market Intelligence for NT$136.69 billion in net profit.