09.28.2001
New TSMC guidance lops 20% off rev. forecast

• Development: TSMC has issued an updated 2001 forecast, with revenues at NT$122bn and after-tax profit at NT$11bn, leading to EPS of NT$0.63. The downgrade is mainly attributable to the impact of the US terrorist stikes.

• Analysis: The revenue forecast is 6% short our own estimates and represents as much as a 20% revision to previous 4Q01 guidance. The effect of the US events on the local semiconductor industry, which we previously estimated at a 15% drag on revenues, could run much deeper in 4Q01 for other weaker players in the industry including UMC, wiping out all seasonal strengths initially observed in August.

• Primasia View: We remain bearish on the industry’s near-term prospects as the impact of recent events becomes evident.