TSMC expects to hit $100 billion in sales in 2025, analysts say it's on track

According to analysts at New Street Research, TSMC still has a bright future despite the turmoil in the semiconductor market and chipmakers and designers facing the challenge of reduced orders

Industry headwinds have caused TSMC to suffer two losses this year It has lowered its revenue guidance this time, but analyst Pierre Ferragu believes that the company's revenue can reach as high as 100 billion US dollars by 2025 (note from this site: currently about 731 billion yuan).

The report said that of all chip companies, TSMC management was the most cautious in its forecasts on the earnings call, admitting that the preliminary estimate of the semiconductor industry inventory adjustment was shorter than expected. The inventory adjustment incentivizes TSMC's customers to order more silicon wafers as they rush to meet demand. However, as long as the market is oversupplied, orders remain low, further increasing capital expenditures as its machines cannot produce at full capacity.

But Ferragu said the trouble in the chip industry may end next year. TSMC's profit and loss statement will rebound in 2024, the analyst said in a note released on Friday. He added that 2025 could be a banner year for the company, with TSMC's revenue hitting $100 billion for the first time.

TSMC’s annual revenue in December 2022 was US$75.9 billion (approximately RMB 554.829 billion). The company's revenue for the full year of 2023 is expected to drop by approximately 10% to US$68.31 billion (approximately RMB 499.346 billion). Ferragu agreed with that estimate, forecasting TSMC's net sales of $68 billion in 2023. Looking ahead, the analyst sees a recovery in product demand coming, with growth in enterprise computing chip products used to run data centers and Other infrastructure needs have increased. In addition, TSMC is currently manufacturing products using 3nm chip technology and plans to switch to 2nm technology in 2025.

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