TSMC revenue news suggests steady business for it and Apple

While I must warn that I’m extrapolating a lot of information from a small amount of data, news from Apple ‘s contract chip manufacturer, TSMC, suggests that while Apple may have seen some sales deceleration in recent months, it has not been a blood bath and sales remain pretty good.

TSMC revenues seem on track with last year’s quarter

TSMC today announced its net revenue for June 2022 as it prepares for its second quarter earning conference on July 14.

The company said:

“On a consolidated basis, revenue for June 2022 was approximately NT$175.87 billion, a decrease of 5.3 percent from May 2022 and an increase of 18.5 percent from June 2021. Revenue for January through June 2022 totaled NT$1,025.22 billion, an increase of 39.6 percent compared to the same period in 2021.”

The extrapolation I’m proposing is that these results seem on track with the company’s guidance, which stood at $17.6-18.2 billion for Q2.

I think this means the company is on target to achieve expectations, which suggests (given how important Apple is to TSMC), that reports of softness in Apple’s business may have been, as they say, “over-exaggerated”.

Apple may surprise you yet

That’s not such an outlandish thought.

We know that softness is impacting every economy, but the pattern that seems to be emerging is, that when push comes to shove, consumers digging in for what they think will be a tough future are investing in the best kit they can afford. They don’t know when they’ll buy again, and they want stuff that lasts.

And, when it comes to the best available kit, it’s always Apple that seems to deliver it, particularly now its offer has been vastly improved with Apple Silicon. So, sales are softer, but not absent – and Apple will be banging the subscription and services drum to build new revenue to navigate its course through the new market.

Yes, the future market will be challenging, but Apple management seem pretty good at both growing revenues and the bottom line – and it’s not as if they haven’t got *cough AR cough car* “new and exciting” new product families to keep people interested.

Looking to the next fiscal calls

While we won’t learn anything about new product, we may learn a little more business insight at TSMC’s Second Quarter 2022 Earnings Conference on Thursday, July 14, 2022, at 14:00 Taiwan time/ 2:00 Eastern Time. This will probably provide a decent (if not completely accurate) insight into what Apple itself will be telling us during its own fiscal call July 28. (As a guide, revenues last year hit a new June record. If Apple has remained stable in comparison to last year, as TSMC’s data seems to suggest, then even at the most bleak forecast, the company is likely to deliver significant business upside and I think the recent softness in its stock will be shown as being over-baked.

So that’s what we have so far.

By the way, speaking of over-baked, I’m due to cough up additional hosting fees in the next few weeks, so I’d be so grateful for any support you can provide.

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