Taiwan Semiconductor Manufacturing Company (TSMC) has announced that its fourth-quarter sales will come in well below the company's previous guidance given at the end of October due to a reduction of wafer shipments.

The company now expects fourth-quarter revenues to be between NT$63-65 billion (US$1.9 billion), 8-9% lower than the previous expectation of between NT$69-71 billion. The outlook also represents a sequential drop of up to 32% from the foundry's consolidated sales of NT$93 billion in the third quarter.

The foundry also cut its profit forecast, with fourth-quarter gross profit margins now expected to fall between 30-32%, while operating profit margins will be between 17-19%, lower than the previous guidance by 4 percentage points each, TSMC indicated.

This is only the third time in TSMC's history that it has downwardly adjusted its financial forecast, with the last time happening during the semiconductor industry downturn in 2001.

TSMC is not the only semiconductor industry giant dealing with a dramatic change in market dynamic this quarter. Intel has also announced that its fourth-quarter business will be below the company's previous outlook. Intel expects its fourth-quarter revenues to total only around US$9 billion, down from a previous expectation of between US$10.1 billion and US$10.9 billion.

By: DocMemory
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