TMSC Raises Its 2020 5G Smartphone Forecast Even Amid Pandemic

Taiwan Semiconductor Manufacturing Co. business increased slightly in Q2 as 5G deployments offset other weakness, said CEO C.C. Wei on a Thursday investor call. COVID-19 “continues to bring some level of disruption to the global economies,” he said: TSMC is observing “weak consumer demand.” It expects 2020 global smartphone unit shipments to decline by a “low teen” percentage year-over-year, he said. But supply chains are making efforts to build back stability in “actively preparing for new 5G smartphone launches,” he said. The chipmaker is upgrading its 2020 forecast for 5G smartphone penetration to the “high teens” of the total smartphone market in 2020 from 5%-10% penetration in its April forecast, said Wei. TSMC thinks the long-term “underlying megatrend” of 5G remains “intact,” he said: Supply chains will “adjust and rebalance.” There "may be some impact” from the Commerce Department’s May 15 increased export control restrictions on Huawei (see 2005150027), he said. TSMC doesn’t plan to ship Huawei wafers after Sept. 14, said Chief Financial Officer Wendell Huang. TSMC remains on track to build an “advanced semiconductor fab” in Arizona, said Wei: Production is “targeted” to begin in 2024 with monthly capacity of 20,000 wafers.