TSMC shares fall on Apple, Qualcomm order loss reports
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[July 17, 2014]
By Michael Gold
TAIPEI (Reuters) - Shares of Taiwan
Semiconductor Manufacturing Co Ltd (TSMC) fell as much as 6 percent
on Thursday after an analyst and Taiwanese media reported the likely
loss of orders for next-generation chips from Apple Inc and Qualcomm
The world's largest contract chip manufacturer on Wednesday reported
its highest quarterly profit since the end of 2006, and said it
expected revenue to grow at least a record 20 percent this year.
Behind the bullish outlook was likely increased demand from Apple
which recently chose TSMC over Samsung Electronics Co Ltd to make
the majority of chips for the successor to its iPhone 5 series of
smartphones, industry insiders said.
But both Apple and Qualcomm will likely buy a larger proportion of
14 nanometer smartphone chips from Samsung rather than TSMC
beginning in the second half of 2015, KGI Securities analyst Michael
Liu said in a note to clients.
Liu did not detail the source of the information in the note, issued
late on Wednesday following an investor conference held after TSMC
reported second-quarter earnings.
The Commercial Times on Thursday, citing market speculation, said
Qualcomm has already started working with Samsung to develop the
chips. The Economic Daily News said without citing sources that
Qualcomm had placed orders with Samsung.
The reports sent shares of TSMC down as much as 5.75 percent in
Thursday trade compared with a 1 percent decline in the benchmark
Yuanta Securities Analyst George Chang, who also attended the
conference, said of Apple and Qualcomm on Thursday that "This is
still just a lot of speculation."
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"We haven't even seen the iPhone 6 yet, so it's too early to say
anything about future products," Chang said.
During the conference, TSMC Chairman Morris Chang said the company's
market share in 16 nanometer chips - which perform similarly to 14
nanometer chips - will be smaller than "a major competitor" next
year, and that TSMC will regain a leading share from 2016.
The size of chips in the latest high-end smartphones is 28
nanometers, according to TSMC.
On Thursday, spokespeople at TSMC in Taiwan and Apple in China could
not be reached for comment.
A Qualcomm representative in China said she had not seen the reports
and so declined to comment. A Samsung representative in South Korea
also said she had not seen the reports and declined to comment.
(Editing by Christopher Cushing)
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