Gross profit margin is 47.6%, who made TSMC and ASML?

Today, TSMC announced its financial report for the third quarter of 2019. The financial report shows that TSMC’s Q3 consolidated revenue was NT$293.045 billion (about 679.11 RMB), an increase of 12.6% over the same period last year. As high as NT$101.07 billion (about 23.4 billion yuan), a year-on-year increase of 13.5%, a month-on-month surge of 51.4%, and TSMC’s gross profit margin reached 47.6%.

Huang Renzhao, chief financial officer of TSMC, said that in the fourth quarter of the future, TSMC’s consolidated revenue will be between 72.4 billion yuan and 73.1 billion yuan, and the gross profit margin will continue to remain between 48% and 50%. It can be seen from TSMC’s revenue structure that 7nm accounts for 27% of revenue, 10nm accounts for 2% of revenue, 16nm accounts for 22% of revenue, and advanced processes (16nm and below) contribute 51% of TSMC’s revenue receive.

Unmatched gross margin

Compared with TSMC, several other foundries will be inferior in terms of revenue and profit. Data shows that in Q3 2019, TSMC ranked first in the global wafer foundry industry with 50.5%, Samsung ranked second with 18.5%, and the rest shared 30% of the market share.

In June this year, SMIC’s total revenue was US$791 million, a year-on-year decrease of 11.2%; gross profit was US$151 million, a year-on-year decrease of 30.6%, and SMIC’s main revenue was 0.15% / 0.18 micron contribution, 28nm contribution is only 8.6%, the latest news is that SMIC’s 14nm will be mass-produced in 2021.

Another wafer foundry, UMC, recently completed the full acquisition of the 12-inch wafer foundry Mie Fujitsu semiconductor, a joint venture with Japan’s Fujitsu Semiconductor, to expand UMC’s 12-inch wafer fab production capacity. Its revenue in the third quarter was 8.74 billion yuan, an increase of 4.74% month-on-month, while GF has been selling factories, gross profit may be maintained, and market share is declining.

ASML takes another order

As TSMC’s good comrades-in-arms, ASML and TSMC have been challenging the limits of human technology, and the revenue of the two companies is also creating brilliance together. Yesterday, ASML, the world’s leading lithography machine, released its third-quarter financial report. The data shows that ASML’s revenue in the third quarter reached 3 billion euros, with a net profit of 627 million euros and a gross profit margin of 43.7%. It is estimated that it will continue to grow in the fourth quarter. Revenue fell to about 3.9 billion euros, and gross profit margins were estimated at 48 to 49 percent. ASML said that it has completed the shipment of 7 EUV systems in the third quarter, and received orders for 23 EUV systems, setting a record for the highest order amount in a single quarter. Behind this achievement, TSMC, as the largest customer, has made a lot of force.

Samsung and TSMC have been competing in advanced processes. Since 2018, as the world’s first mass-produced 7nm FinFET process company, TSMC once led the industry and added EUV lithography technology to the 7nm process in 2019. Samsung Unwilling to rank second, it has frequently released its investment plans in the foundry field recently. It is rumored that Samsung Electronics has recently ordered 15 EUV equipment from ASML.

In 2019, ASML plans to produce 30 EUV lithography machines, 18 of which are reserved by TSMC. At an offer of $120 million per lithography machine, TSMC spent a total of 15 billion yuan to purchase these lithography machines. The engraving machine has promoted a large increase in TSMC’s 7nm shipments, and the lithography machine has become a money printing machine in the hands of TSMC. Since the beginning of this year, TSMC’s revenue has repeatedly broken records, and its production capacity has been in a hurry. 16nm orders need to be booked in advance, and even Intel has been squeezed out of the leading position in semiconductors. TSMC recently announced that it has started mass production of the 7nm+ EUV process, which is the first commercial EUV lithography process for the company and the entire semiconductor industry.

Compared with 7nm, 7nm+ can bring a 15-20% increase in transistor density in performance, while improving power consumption, and has been applied to products of many customers. Although the official list has not been given, it is certain that Huawei Kirin 990 5G, AMD’s next-generation Zen 3 architecture has also been marked as a 7nm+ process.

5nm mass production in advance

Next, TSMC will continue to rush to 6nm, 5nm, 3nm, and 2nm. In order to put 5nm into production as soon as possible, the fourth quarter budget approved by the board of directors in mid-August has a capital budget of about NT$200.9 billion 9.31 million, an increase of 47% over the same period last year. %, mainly used for construction, expansion of factories and upgrade of advanced manufacturing capacity. SMC revealed that the research and development of the 5nm process has been completed, and the mass production time has been advanced. From the previously planned 45,000 wafers per month to 50,000 wafers per month.

According to official data, compared with 7nm (first-generation DUV), the new 5nm chip based on the Cortex A72 core can provide 1.8 times the logic density, 15% faster speed, or 30% lower power consumption. The same process SRAM Also very good and area reduced. As for customers of 5nm chips, Apple and Huawei’s 5nm chips have been successfully taped out, and it is expected that Qualcomm and AMD will also become Huawei’s customers.