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IBDvalueinvestin (98.52)

2010 Chip sales to hit All time high



June 15, 2010 – Comments (5) | RELATED TICKERS: TSM , AMKR , AMAT

Says Morris Chang of TSMC Taiwan Semiconductor Manufacturing Company

TSMC Chang more upbeat on 2010 chip growth

Nancy Cheng, Hsinchu; Jessie Shen, DIGITIMES [Tuesday 15 June 2010]

Morris Chang, chairman and CEO of Taiwan Semiconductor Manufacturing Company (TSMC), has again raised his forecast for chip market growth in 2010. Speaking at a shareholders meeting on June 15, Chang said the global semiconductor market is expected to grow 30% in 2010.

Chang previously predicted the overall chip market would rise 22% in 2010, which was already an upward revision from his earlier estimate of 18% growth.

Chang also upwardly revised its CAGR projection for the overall chip industry from 2011 to 2016. He now expects the global semiconductor market to grow with a CAGR of 7% over the next five years, higher than 4-6% that was earlier estimated.

Chang reiterated TSMC's consolidated revenues for 2010 will likely hit an all-time high, resetting the record of NT$333.16 billion (US$10.3 billion) in 2008. It also stands a chance of hitting record profits in 2010, Chang added.

Chang did not make changes to TSMC's capex plan for 2010. The budget remains at US$4.8 billion.

In addition, Chang cited localized sales and support as the main reason for TSMC has built a production plant in China, rather than cheap labor costs. More than 1,000 employees are stationed at its 8-inch plant located in the Shanghai Songjiang Industrial Zone, said Chang, adding that salaries for the workers will not be raised in the short-term.

Chang was quoted in previous reports saying the average wage for TSMC's staff at its Shanghai facility is 2,000 yuan (US$293) a month


5 Comments – Post Your Own

#1) On June 15, 2010 at 10:52 AM, outoffocus (24.08) wrote:

Well I do love my Herr's Jalapeno.

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#2) On June 15, 2010 at 11:06 AM, IBDvalueinvestin (98.52) wrote:

Good joke outoffocus but the reality is semiconductor chip sales are soaring at volumes never before seen and this is due to the Asian market soaring computer and smart phone sales.

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#3) On June 15, 2010 at 11:21 AM, IBDvalueinvestin (98.52) wrote:

TSM guidance today means we can safely assume other semiconductor stocks will be raising guidance ahead of earnings as well.


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#4) On June 15, 2010 at 11:31 AM, IBDvalueinvestin (98.52) wrote:

I can only imagine what the 24% shares short on AMKR are thinking right now. Hmm if Semiconductor sales are gonna rise much higher than previously expected this Spring then that means alot more work for AMKR.

Short Squeeze would occur if AMKR came out with higher guidance now like TSM or is the short squeeze already occuring ahead of now expected higher guidance.


AMKR Shares Short as of May 28, 2010 = 24.10%


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#5) On June 15, 2010 at 12:26 PM, IBDvalueinvestin (98.52) wrote:

Finally during the lunch hour Bloomberg radio catches on the Raised chip forecast by TSM.

It took them 4 hours but they finally had to acknowledge it.


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