Taiwan Semiconductor Manufacturing Company

Company Description:

Founded in Taiwan in 1987 by Morris Chang. It is one of Taiwan's largest companies, the world's most valuable semiconductor company.
Largest market share in semiconductor foundry market by 51.5%
Foundry service provider for: Advanced Micro Devices (AMD), Apple Inc., Broadcom Inc., Marvell, MediaTek, Nvidia, etc.
Gross profit margin was 53.1 percent compared with 46.0 percent in 2019, while operating profit margin was 42.3 percent compared with 34.8 percent a year earlier. Net profit margin was 38.7 percent, an increase of 6.4 percentage points from 2019’s 32.3 percent.

Company Product Overview:

5nm process nodes – This is TSM’s highest demanded chip. In October 2020 TSMC revealed that 5nm nodes will be used in iPhones and
7 nm process nodes – Currently, it’s TSM’s best-selling chip. TSMC was the first company that began manufacturing memory chips using a 7 nm process and is the industry dominator in this process
3nm process nodes – This change in process nodes will create major changes in semiconductor industry. There will be 10-15% increase in performance, with a 25-35% decrease in power consumption. Only one other company besides TSM has been able to create a 3nm process. Samsung, however, Samsung has not announced that they will be able to bring the 3nm to market on a mass scale

Revenue is largely derived by their smartphone platform, HPC being the second most.
Total wafer shipments were 12.4 million 12-inch equivalent wafers as compared to 10.1 million 12-inch equivalent wafers in 2019
For the five major markets, namely smartphones, high performance computing, the Internet of Things, automotive electronics, and digital consumer electronics and in response to the fact that focus of customer demand is shifting from process-technology-centric to product-application-centric, TSMC has constructed five corresponding technology platforms to provide customers with the most comprehensive and competitive logic process technologies, specialty technologies, IPs and packaging and testing technologies to shorten customers’ time to design and time to market.

Covid-19 had a negative impact on the production levels globally causing decreased sales and overall profitability
Total wafer shipments were 12.4 million 12-inch equivalent wafers as compared to 10.1 million 12-inch equivalent wafers in 2019s
TSMC produced 24 percent of the world semiconductor excluding memory output value in 2020, as compared to 21 percent in the previous year.
TSMC is exposed to interest rate risks primarily related to its investment portfolio and outstanding debt
TSMC employs third-party service providers for the Company and its affiliates worldwide with whom it needs to share highly sensitive and confidential information to enable them to provide the relevant services