Source: Taiwan Semiconductor Manufacturing Co., Ltd
Taiwan Semiconductor Manufacturing Company (TSMC) in 2023 surpassed both Intel and Samsung, two of the biggest chipmakers in the world, in terms of revenue.
Historically, TSMC trailed behind Intel and other major memory manufacturers in earnings. But it now leads in operating profit, consistently generating substantial cash flows.
Dan Nystedt, an analyst based in Taiwan, shared the numbers in a post on X, using the firm's calendar-year revenue data rather than fiscal-year performance. He used figures that encompass revenue from various sources within each company, not solely income derived from silicon manufacturing.
Despite facing a challenging year, TSMC's earnings for 2023 amounted to $69.3 billion, surpassing both Intel, which saw a decline to $54.23 billion, and Samsung, with earnings of $50.99 billion.
Nvidia's revenue for the year could exceed $58 billion based on fourth-quarter guidance, positioning it to outperform both Intel and Samsung but not TSMC, he wrote.
According to Nysted, the surge in TSMC's revenue commenced notably in 2020, largely attributable to the COVID-19 pandemic's impact and heightened demand for digital products such as PCs and gaming consoles.
TSMC's advancement in process technologies over its competitors allows it to command premium prices for its services, bolstering its revenue streams.
For decades, Intel held the reins in the semiconductor industry, reigning supreme from 1992 when it surpassed NEC, until 2017 when Samsung surged ahead.
Samsung's semiconductor revenue heavily relies on the fluctuating prices of 3D NAND and DRAM memory, whereas Intel's revenue predominantly stems from logic products, particularly CPUs tailored for client and data centre applications.
It's worth noting that at present, a significant portion of Intel's products are manufactured by TSMC.
On the other hand, TSMC doesn't design its own processors but specialises in manufacturing cutting-edge chips for various fabless developers, including AMD, Apple, Nvidia, Qualcomm, and numerous others.
Evidently, its strategy has proven highly successful, at least for the time being.
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