Overall, revenue and earnings per share increased by 42% and 91% year-on-year, respectively, this is due to the impact of the cyclical sales decline in the industry due to the 2019 Sino-US trade war. With the increase in the production of 5nm node chips, the revenue has grown much faster (the smallest currently the most advanced chip design) has withdrawn from the research and development stage, and began to contribute to sales. This is part of why TSMC is a fascinating stock. In addition to benefiting from higher chip usage brought by global digitization, the company is also a leader in manufacturing technology-not only enabling it to be commercialized, but also making the most advanced hardware the basis of the most important technological advancements.
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Whether it is a chip that supports 5G network connection, a graphics processing unit that powers data centers and edge networks, or a Google tensor processing unit design that supports AI ’s Alphabet, TSMC can participate.
Strong cash flow and stable balance sheet
However, TSMC is a more measurable investment that will expose you to high technology. Over the past five years, the company's revenue has "increased" by only 25%, but considering the company's market value at the time of writing, this is a considerable number. Together with the dividend yield, this is a good place to store cash.
But manufacturing capacity is only part of it. TSMC has done an excellent job of managing its balance sheet and obtaining generous returns from its capital investments (funds used for operational upgrades and other growth plans). Sufficient cash and little debt mean that the chip maker will be able to withstand any sudden COVID-19 destruction, invest in manufacturing innovations and continue to pay dividends.