Taiwan's TSMC to Get iPhone 7 Revenue Boost

The world's biggest contract microchip maker by revenue predicted Thursday a third quarter growth boost, with analysts saying it would benefit from Apple's new iPhone series launch.

Taiwan Semiconductor Manufacturing Co (TSMC) said income in the three months to September was expected to increase to Tw$254-$257 billion (around $8 billion), up about 20 percent from a year earlier.

TSMC has never officially confirmed it is an Apple chip supplier but industry watchers said the company is expected to produce the A10 chip for the iPhone 7 series which may debut in September.

"TSMC's third revenue growth forecast is much higher than other companies in the industry. Apple's new iPhone launch will apparently give a big boost to the company," George Chang of Yuanta Securities Investment Consulting told AFP.

Apple has reportedly ordered at least 72 million units of the iPhone 7 series from its Taiwanese suppliers, a significantly higher figure than the 65 million previously predicted by some analysts.

TSMC also announced Thursday better-than-expected results for the three months to June owing to rising demands in mid-range and low-end smartphones as well as customer inventory restocking, its Chief Financial Officer Lora Ho said in a statement.

The company has seen its earnings slip as it vies with regional rivals such as South Korea's Samsung and Chinese firms for a greater share of a weakening smartphone and electronics market.

Second-quarter net profit fell 8.7 percent to Tw$72.51 billion from a year ago, improving from a 18 percent decline in the first quarter and beating the average estimate of Tw$68.9 billion from analysts surveyed by Bloomberg News.

Revenue in the second quarter rose eight percent to Tw$221.81 billion on-year, better than its forecast in April of six to seven percent of growth due to delayed shipments caused by a powerful earthquake. The Q3 revenues were up 15 percent from the second quarter, the company added.

In a bid to boost market share, TSMC in March signed a $3 billion deal to build a plant in China -- Taiwan's largest-ever outbound investment on the mainland.