Taiwan Semiconductor Manufacturing Co. (TSMC) forecast second-quarter sales below analyst estimates, citing a fall in smartphone sales and personal computer shipments. The world’s largest contract maker of microchips also reported Thursday an 18 percent slump in first quarter profits.
The company which supplies processors to Apple Inc. was also affected by an earthquake in February that held up production, the earnings statement said.
Sales in second quarter will be between 215 billion New Taiwan dollars ($6.6 billion) and $218 billion New Taiwan dollars ($6.74 billion) in the second quarter, the chipmaker said Thursday, below analysts’ estimates of 225 billion New Taiwan dollars ($6.95 billion), according to Bloomberg.
Meanwhile, the company’s first quarter revenue fell 8.3 percent to $6.27 billion, as sales from its personal computers business fell 7 percent and demand for its smartphone chips slowed. The company cut its forecast for growth in demand for its smartphone chips to 7 percent for 2016, down from 8 percent.
“February sales missed our expectation due to earthquake damage,” Ethan Chen, an analyst with Sinopac Financial Holdings, told Bloomberg. That impact was exacerbated by a relatively long Chinese New Year break, he added.
TSMC, however, maintained its capital expenditure budget of between $9 billion and $10 billion over the full year.