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Taiwan Semiconductor Manufacturing Beats on Both Top and Bottom Lines

By Seth Jayson - Updated Apr 7, 2017 at 12:05PM

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Just the facts, Fool.

Taiwan Semiconductor Manufacturing (NYSE: TSM) reported earnings on Oct. 25. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Taiwan Semiconductor Manufacturing beat slightly on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share grew.

Margins expanded across the board.

Revenue details
Taiwan Semiconductor Manufacturing logged revenue of $4.82 billion. The 18 analysts polled by S&P Capital IQ wanted to see net sales of $4.76 billion on the same basis. GAAP reported sales were 38% higher than the prior-year quarter's $3.49 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.32. The five earnings estimates compiled by S&P Capital IQ predicted $0.30 per share. GAAP EPS of $0.06 for Q3 were 50% higher than the prior-year quarter's $0.04 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 48.8%, 680 basis points better than the prior-year quarter. Operating margin was 37.2%, 750 basis points better than the prior-year quarter. Net margin was 34.9%, 640 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $4.45 billion. On the bottom line, the average EPS estimate is $0.26.

Next year's average estimate for revenue is $17.25 billion. The average EPS estimate is $1.07.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,358 members out of 1,406 rating the stock outperform, and 48 members rating it underperform. Among 308 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 301 give Taiwan Semiconductor Manufacturing a green thumbs-up, and seven give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Taiwan Semiconductor Manufacturing is hold, with an average price target of $14.83.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Taiwan Semiconductor Manufacturing Company Limited Stock Quote
Taiwan Semiconductor Manufacturing Company Limited
TSM
$90.86 (1.50%) $1.34

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