TSMC Reports Second Quarter EPS of NT$3.06

Hsinchu, Taiwan, R.O.C., July 16, 2015 -- TSMC today announced consolidated revenue of NT$205.44 billion, net income of NT$79.42 billion, and diluted earnings per share of NT$3.06 (US$0.50 per ADR unit) for the second quarter ended June 30, 2015.

Year-over-year, second quarter revenue increased 12.2% while net income and diluted EPS both increased 33.0%. Compared to first quarter 2015, second quarter results represent a 7.5% decrease in revenue, and a 0.5% increase in net income. All figures were prepared in accordance with TIFRS on a consolidated basis.

In US dollars, second quarter revenue decreased 5.4% from the previous quarter and increased 9.6% year-over-year.

Gross margin for the quarter was 48.5%, operating margin was 37.5%, and net profit margin was 38.7%.

Shipments of 20-nanometer process technology accounted for 20% of total wafer revenues. 28-nanometer accounted for 27% of total wafer revenues. Advanced technologies, defined as 28-nanometer and 20-nanometer technologies, accounted for 47% of total wafer revenues.

“Due to customers’ cautious inventory management and a less favorable exchange rate, our second quarter business had declined but was within our expectation and guidance,” said Lora Ho, SVP and Chief Financial Officer of TSMC. “However, the end market recovery is not as strong as was expected earlier; customers continue to remain cautious in inventory management. Combining these factors with customers’ product transition, demand for TSMC wafers in the third quarter is expected to recover only modestly. Based on our current business outlook and exchange rate assumption of 1 US dollar to 31 NT dollars, management expects overall performance for third quarter 2015 to be as follows”:

• Revenue is expected to be between NT$207 billion and NT$210 billion;
• Gross profit margin is expected to be between 47% and 49%;
• Operating profit margin is expected to be between 36.5% and 38.5%.

TSMC's 2015 Second Quarter Consolidated results:
(Unit: NT$ million, except for EPS)

	2Q15 Amount a	2Q14 Amount	YoY Inc. (Dec.) %	1Q15 Amount	QoQ Inc. (Dec.) %
Net Sales	205,440	183,021	12.2	222,034	(7.5)
Gross profit	99,705	91,190	9.3	109,429	(8.9)
Income from operations	77,069	70,710	9.0	86,626	(11.0)
Income before tax	98,132	74,094	32.4	88,259	11.2
Net income	79,417	59,698	33.0	78,990	0.5
EPS (NTS)	3.06b	2.30b	33.0	3.05b	0.5

a: 2Q2015 figures have not bee approved by Board of Directors
b: Based on 25,930 million weighted average outstanding shares