Taipei--Taiwan Semiconductor Manufacturing Co. (TSMC, ???), the world's largest contract chip maker, posted its lowest sales in six months in January, largely due to slow season effects in the semiconductor industry, analysts said.
TSMC's sales for the month were also hurt by the reduced number of working days in January as the six-day Lunar New Year holiday began on Jan. 27, according to analysts.
In a statement issued Friday, TSMC reported consolidated sales of NT$76.62 billion (US$2.47 billion) for January, down 1.9 percent from a month earlier but up 8.1 percent from a year earlier.
TSMC's monthly sales in January were the lowest since July 2016, when consolidated sales totaled NT$76.39 billion, but that did not surprise analysts given that the first quarter is traditionally the slow season for the semiconductor industry.
At an investor conference held in mid-January, TSMC expected consolidated sales for the first quarter to fall 8.8-10 percent from a quarter earlier to between NT$236 billion and NT$239 billion.
Based on that sales guidance, TSMC could see its monthly sales recover to between NT$79.7 billion and NT$81.2 billion in both February and March, analysts said.
TSMC cautioned at the investor conference that inventory levels in the global IC industry are expected to remain high in the first quarter and that inventory adjustments could continue into the second quarter, which could dampen sales in the April-June period.
Also in Friday's statement, TSMC said its board of directors has scheduled a meeting on Feb. 14 to discuss its dividend policy for 2016.
The chip maker has said it expects to pay out a cash dividend for 2016 exceeding the NT$6 dividend it distributed on 2015 earnings because its earnings per share rose to NT$12.89 in 2016 from NT$11.82 in 2015.
Meanwhile, United Microelectronics Corp. (UMC, ??), the second largest contract chip maker in Taiwan, said on Friday that its consolidated sales totaled NT$12.65 billion in January, up 0.75 percent from a month earlier and up 5.37 percent from a year earlier.
Analysts said the launch of commercial production at UMC's wafer plant in Xiamen at the end of last year provided a boost to the chip maker's sales in January.
But UMC is expected to be affected by the seasonal first quarter slowdown in the sector as it has forecast that its wafer shipments for the three-month period could fall 1 percent and its consolidated sales could fall about 4 percent from the previous quarter.
Source: Focus Taiwan News Channel