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TSM Taiwan Semiconductor Manufacturing

Participants
Jeff Su Director of Investor Relations
Wendell Huang Vice President of Finance and Chief Financial Officer
C. C. Wei Chief Executive Officer
Mark Liu Chairman
Randy Abrams Credit Suisse AG
Bruce Lu Goldman Sachs Group, Inc.
Charlie Chan Morgan Stanley
Gokul Hariharan JPMorgan Chase & Co.
Roland Shu Citigroup Inc.
Brett Simpson Arete Research Services LLP
Charles Shi Needham & Company, LLC
Mehdi Hosseini Susquehanna Financial Group, LLLP
Sunny Lin UBS
Sebastian Hou Neuberger Berman
Laura Chen KGI Securities Co. Ltd.
Krish Sankar Cowen and Company, LLC
Frank Lee HSBC
Call transcript
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Jeff Su

[Foreign Language] Good afternoon, everyone, and welcome to TSMC's Fourth Quarter 2021 Earnings Conference Call. This is Jeff Su, TSMC's Director of Investor Relations and your host for today. To prevent the spread of COVID-19, TSMC is hosting our earnings conference call via live audio webcast through the Company's website at www.tsmc.com, where you can also download the earnings release materials.

If you are joining us through the conference call, your dial-in lines are in listen-only mode. The format for today's event will be as follows: First, TSMC's Vice President and CFO, Mr. our guidance the XXXX. for summarize followed quarter will our by the Huang, operations fourth in XXXX, Wendell first quarter Mr. Afterwards, Huang Dr. and TSMC's CEO, C.C. jointly will provide Company's messages. Wei, the key Dr. Then TSMC's Chairman, where will all questions. the Liu, Mark Q&A three will entertain host executives your session,

harbor like could I safe And everybody like turn remind to those TSMC's the materially cause forward-looking refer actual would and appears may significant risks release. contained quarter the that subject from for that forward-looking that to results are As to discussions statements. in the to and our contain press Huang, guidance. operations notice now, on over to usual, summary Wendell I today's to statements of CFO, current the uncertainties Please would Mr. the which differ call

Wendell Huang

New will the Happy dollar highlights with start everyone. revenue recap of or After Year, presentation Fourth in XXXX. for U.S. full-year quarter a X.X% increased Thank the financial My today. quarter X.X% joining dollar. NT and provide Jeff. sequentially XXXX. you, guidance I Thank for us first will quarter for in fourth the you that,

points pushed donation fourth got as NT$X.XX higher our leverage operating was ROE expenses technology, our strong demand X-nanometer portion increased to quarter. enjoyed margin the our we by XX.X%. XX.X%, sequentially and fourth supported increased points due gross the slightly ahead XX.X%, to the margin vaccine improvement quarter guidance EPS of to X.X industry-leading our As efforts. Operating mainly for business and a percentage to sequentially the cost quarter of was Overall, was continuous X.X out percentage first

total X-nanometer while by of fourth revenue wafer wafer in process XX% contributed accounted as came XX%. from X-nanometer which and revenue, revenue. let's at of technology quarter, on for wafer Advanced X-nanometer below, for XXXX. accounted Now technology. accounted Technology for defined of to was technologies Advanced XX%. full-year revenue contribution basis, revenue XX% in in On are the move X-nanometer the XXXX XX% revenue. X-nanometer XX% a of XX% wafer up

Now X%, X% for XX% increased HPC All to of and account for X% Electronics X%. platform. IoT account growth by for all increased X% in platforms a accounted strong moving our revenue. increased XX%. XX% Automotive X%, quarter to increased account respectively. year-on-year Automotive for quarter. to IoT Smartphone and our fourth IoT Consumer to On for and Overall, account basis, account for growth. X% XX%, X%. full-year on XXXX. to in smartphone accounted XX%, XX% of increased for six fourth and saw revenue DCE increased revenue. the and Digital of also contribution quarter-over-quarter increased platforms increased accounted XX%, for experienced X%. Smartphone HPC, to X% HPC XXXX XX%

Moving on sheet. NT$X.X balance of the trillion. quarter We and to securities fourth the ended marketable with cash

bonds the corporate of in On days increased the days. by the interest-bearing and XX remained ratios, debt days, billion, NT$XX to receivable accrued and days of billion liabilities billion increase accounts NT$XXX accounts during days turnover raised three liabilities others. the increased of increase payable to NT$XX NT$XX of mainly due liability billion in Long-term side, current we XX increased On as mainly while billion, inventory quarter. NT$XXX by financial at

me on let CapEx. comments Now a make and flow cash few

expenditures our fourth our quarter increased Overall, dollar cash issuances. spent bond operations, generated US$X.XX quarter, in the fourth XXXX including balance first at U.S. from billion quarter. payable we dividends. billion increased cash billion. billion billion for In During CapEx and NT$X.X billion from to about NT$XXX due to totaled NT$XXX end NT$XXX quarter of billion distributed trillion Bonds customers, the prepayment in capital the NT$XXX NT$XX by the term, NT$XX cash

in growth our performance of a XG us strong let's technology position to HPC. at capture leadership recap Now of industry's our the and the XXXX. saw megatrend XXXX look as in enabled We

US$XX dollar the appreciated increased X year. impacted margin foreign to exchange revenue gross NT Such points. U.S. unfavorable terms percentage NT during as revenue in XX.X% rate reach In billion. dollar terms, also X% XX.X% by by our Our increased about the

In addition, NX to created dilution also headwind our a margin.

XXXX. cash we while billion drive XX.X% operating were cash continue flow. generated On XX.X%. EPS flow, flow operating NT$X.X to we as we we free of trillion to cost NT$XXX achieve XX.X% increased margin and ROE margin and was of NT$XX.XX, spent to in NT$XXX However, CapEx, improvements, gross able XX.X% in full-year in billion and cash in Overall,

dividends cash billion my in finished financial have paid summary. also We in XXXX. I NT$XXX

to Now our let's turn current quarter guidance.

US$X business the recovery US$XX.X in quarter which and XX%, the billion business quarter than be midpoint. rate be between of and at represent X.X% segment our Based be in margin seasonality to XX% a we billion, the to expect HPC-related recent expected in margin supported continued gross XX% and expect between Automotive on smartphone current Based NT$XX.X, exchange first US$XX.X milder years. revenue by is assumption sequential to outlook, between first our on the to and We operating demand, increase the XX%.

tax between Lastly, to XX% effective rate XX%. This our presentation. financial is concludes XXXX my

on will in to I and that depreciation. future the years. CapEx Now our the anticipation year, in move will follow spent start of our growth is messages. by XXXX will capital on making I Every comments key some budget

a US$XX be by are and strong expected billion support US$XX the and billion. our We US$XX In structural we capture XXXX, customers' to witnessing underlying applications. the our budget semiconductor X-nanometer. between HPC advanced budget in growth. XXXX, Out billion including making billion US$XX megatrends to technologies, XX% spent XXXX, industry be be allocated packaging for advanced and for and between for US$XX billion and be mask demand process is to spent XX% will XX% to XG-related capital increase underpinned technologies. XX% In of will CapEx XX% X-nanometer, and capital to for of X-nanometer, X-nanometer the specialty will the spent of About demand

mid-teens Our TSMC CapEx partially percentage on XXXX, a this reiterate and depreciation an low be newly incurred quarterly we expense committed increase in both dividend sustainable annual as to XXXX remains With will basis. in by off rolling notes by depreciation that spending other is year-over-year expected cash offset level to to depreciation. of

me turn over C.C. microphone let the Now, to

C. C. Wei

Thank healthy safe during is this you, staying Wendell. We and time. hope everybody

me start XXXX our let First, outlook. with

We expect XXXX growth to be strong for TSMC. another year

to approximately of the For memory, semiconductor grow overall we the full-year close XX%. XXXX, industry to growth while forecast to is be market, foundry excluding X%, forecast

outperform can we foundry are XXXX between we XXs grow U.S. revenue TSMC, percent in For confident mid-to-high and growth term. dollar in the

inventory all which IoT are strong ensure by industry-leading compared the higher chain level and supply supply Entering our strong the XXXX, Our smartphone, growth for as XXXX we and to industry's where to interest specialty four automotive. fueled platforms, HPC, security. historical given level from the continued to will advanced technologies, demand business a we be seasonal expect need maintain of see

may While increase HPC-related to XG underpinned not we persist, industry the the continue megatrend long-term or imbalance in applications. of demand semiconductor short-term observe may and structural by the

higher We including servers, content silicon automotive, end devices, PCs, in also networking many observed the and smartphones.

we tight advanced will technology result, expect leadership capacity our and strong to XXXX for we the TSMC as specialty believe our throughout a As enable technologies. to demand capture remain our

long-term TSMC's growth Next, talk me about outlook profitability. let and

higher We growth. are a entering structural period of

transformation is increasing. lives in and pervasive supply semiconductor more essential digital becomes technology the the and chain people's the accelerates, industry As in value

connected and structural leading-edge to with customers customers' At their in the and TSMC same specialty for embark technology committed growth will world As upon and and market which intelligent the are power computing, the computation HPC, enrichment leading-edge massive greater XG support invest that energy-efficient spur group working to in more and for demand. technologies. time, is substantial in long-term The of use need long-term our address our unit to us content an demand a growth plan importantly, era, we more capacity investing proper increase a drive megatrend the demand profitable support profile. of to multiyear our multi fuel semiconductor achieve and IoT requirement propel applications shareholders. greater sustainable deliver XG enable to and to will smartphone, HPC-related we and and return applications volume growth automotive our for closely

the in growth that three of our billion spending we to in US$XX US$XX.X CapEx billion have last anticipation years, XXXX XXXX follow. will the invest in we Over raised from as

our in billion U.S. or X.Xx. in dollar to terms XXXX has same EPS billion from US$XX.X increased US$XX.X revenue period, in XXXX the X.Xx by During and our

differentiated largest the and are technologies. well industry with capacity as favorable our manufacturing ahead, excellence the reliable megatrend world's the with leadership, trust, our effective customer Looking growth capture from technology positioned provider we and to

which between and We terms, dollar U.S. course, next growth expect automotive. be CAGR fueled all four HPC, several years long-term are the by over revenue smartphone, XX% and to our in of IoT platform, XX%

to it main of area our revenue driver HPC and the will computation, in With CPU, TSMC's the and contributor increasing accelerators be with growth the need long-term our platform. of growth expect the strongest HPC are the AI terms largest incremental growth GPU for for be

invest technology cost and we investment commodity new manufacturing and we mature in increasing expansion face our rising due As customers' materials and of our leading-edge manufacturing demand, leading-edge challenges node, support to complexity to global process in continue at costs. specialty to basic node, footprint

our customers pricing our growth, not value their We remain our opportunistic, closely and to reflect work continuing to strategy support to will are with creation. strategic,

gross return and we even to our such achievable, our work we a greater and margin showed our cost sustainable greater long-term diligently actions, through growth XX% proper and burden to we can a the deliver also can deliver that investment will profitable with higher taking to as is industry, operation of continue ROE our and By our believe cycle. suppliers fab growth own on customers' We invest for long-term of and than in of improvement. Thus, we shareholders. support for earn XX% CapEx

and NXP I will NXX about talk Now status. NX,

As very by its strong, NX HPC driven to continues and entered our ramp, be smartphone applications. demand third-year

X-nanometer further technologies. we proven XX% be for and improvement competitive performance density power easy half migration XXXX. family's from schedule has NX gain. boost enhance NX second and as most industry's introduced with taking technology. NXP for NXP NX NXX our with compared offers designed and density next-wave To improvement is XX% Our power to efficiency also products product, for our in leading-edge NXP performance, its NX X% to the

Without offer especially expect XXXX. applications. boost of family NXX We process grow over and our our also first much more introduced for half large for NXX for production to performance expect risk several circuit and years as workload-intensive an to to in enter TSMC. and offering enhancement for optimized will NX be in the technologies, it NX to next NX family long-lasting HPC we node demand continuous continue a we NX

me status. talk about let Next, and NX NXE

and technology technology transistor deliver cost NX for FinFET our maturity, performance best to structure will Our the customers. use

is Our track. NX technology on development

support applications. both and complete second in of for start platform developed HPC will have XXXX. smartphone We production NX half

customer engagement the the more first NX for of year level We family the extend further power high to at and compared continue for and NX will performance, see with a as our new with yield. tape-outs expect NXE NX. enhanced NX

level customer year and We is also engagement of after observed at high one a NX. for volume scheduled NXE, production

technology the node transistor technology our introduced. Our demand, X-nanometer in both strong advanced when will are be leadership another and technology our it long-lasting PPA and family customer is will NX and we confident for foundry TSMC. most that be technology large With

technology talk requirement me and node develop meet to customers capacity about customers' value long-lasting TSMC's mature specialty strategy differentiated node create let and work at solutions closely our to with is Finally, strategy. our customers. a mature to to

memory expanding drive in many demand technology XX-nanometer XG XX-nanometer specialty China, the for applications content multiple strategies, multiyear HPC for higher specialty by supported will and demand In embedded end spot Japan megatrend at and technologies. to Taiwan. be increasing We are and and mature size structural our long-term our technologies. We specialty of industry forecast the and support XX-nanometer and capacity our manufacturing of we expect our to be node in sweet silicon devices certain the

long-term and better Our capacity and business our the expansion industry enable and our Thank capture customers' need differentiated opportunities, mature our from on based our and us deliver us the operating We need, cost global reach demand customers' is will serve node profitable This your key technology attention. shareholders. efficiency megatrend concluding specialty growth to the for of considerations. for our to believe enable will talents, you economic expansion generated message. capacity

Jeff Su

concludes remarks. you, C.C. Thank This our prepared

to raise your to Before your time Q&A the please like before answers proceed translate to Should you ask will wish to Instructions] questions. Now I question. begin would in English to everybody at your management Q&A opportunity Chinese, questions session. our we session, question [Operator to a remind to it will the participants we I to two all an limit allow the their

be will Liu, Mark the Dr. host. Chairman, Our

Mark Liu

Hello, this have of to and regards wish want happy Thank you. everyone. to This is successful Mark pandemic Liu. during XXXX. send a and one we I my you every

Jeff Su

Chairman. you, Thank

Operator, first Q&A the begin line? can Let's on session we the with the proceed now. caller please

Operator

ask Credit from to first Randy questions, The Abrams Suisse.

Randy Abrams

on Okay. margins. Yes. and Thank you. the the and Congratulations outlook results

question outlook. they're growth the about First if the mid-to-high compare fabless expectation rollup the When XX% I – IDM growth on customers, mid-teens we growth. versus and

So your pricing bit than you the much And component break moves? build gain, any years. looks also more most it outgrowth share between wider a down if in there? Could factors inventory of there's

Jeff Su

Okay. Randy, me summarize And referring is outlook? Randy... let your I growth question. your the believe first XXXX question to

Randy Abrams

That's right.

Jeff Su

Right.

growing is Randy percentage, XXs guidance industry TSMC's so saying, that fabless around his mid-to-high And the show is of calculation maybe mid-teens.

fabless. the we outgrow foundry So the will sorry,

there is And we such other is And what wondering Is pricing? share… build so into this? driving share it outgrowth. Are can inventory as if factors this he gain,

C. C. Wei

Okay.

question. in a you unit just a share your the the C.C. I growth. It's is me growth Did the a is and also Wei. above gain, it's Let answer Actually, answer all mentioned. This it's XXXX pricing question?

Randy Abrams

Yes, that. And just – two to follow-ups a mostly. quick maybe quick

could much your – is? put you want how Like how you in factor like could more do break a customers big platform indicate do inventory? growth and place to component the by think how if just If you that you think much

Jeff Su

Okay.

give is how growth by inventory a outlook? growth? So we And this playing role Randy's in is then XXXX our much build follow-up can platform of

Wendell Huang

Randy. Hi, is Wendell. This

similar, the close automotive to answer the average. the IoT, corporate question. That's and than me faster In platform expect grow Let smartphones average. corporate XXXX, the the platform we HPC growth. to

Jeff Su

how build playing much And a then, is this? in second is of part Randy’s role inventory

Wendell Huang

Well, higher Randy, the not quantify period to that as high, the factor. we that key than for a C.C. mentioned time, remain expect messages, but level longer inventory before of able to we're

Randy Abrams

could getting lot you understand. Okay. No, you're about ask the customers more question, disclosed those. and if prepayments I Hey, have disclosing second a – a of I been

into this could the be? could and as of if program the about go of looking the that. behind downturn, the if main what a strategy talk for the So would you kind the strategy If disclose behind far protection scenario you're objectives you we as

Wendell Huang

the including diligently work and position with prepayment, risk the to them. plan their receiving commitments way best for we we with Randy, in support will determine strengthen Such help capacity Okay. prepayments customers to yes, capital closely mitigate to or And will capacity, and continue the support. work cash the our capacity. them prepayment our

trust about technology or customers, talking with customer way we always securing Now secure excellence commitments. commitment, closely effective work earning the manufacturing leadership, our and the best we customer that most and are to believe

long and increase demand our plan profitability we the market be on we the protected. can structural capacity utilization as profile, well long-term as So well in believe our based

Jeff Su

does that second question? Thank Okay. Wendell. Randy, address you, your

Randy Abrams

outlay, about sort? also or kind some to have of more policy to a guess, – volume an you to is is so It's Yes. protect in I the of insurance it cash also of terms assurance downturn, still a flow, like in some amount be it

Wendell Huang

best manufacturing I Randy, the with through yes, getting the work as just I and therefore trust. is our commitment way excellence think, earning technology their Well, and to customers their leadership, mentioned,

capacity we based utilization profitability be structural I if plan in So maintained. on the can industry, demand think our well our the then and

Randy Abrams

Wendell. Okay. you, Great. Thank

Jeff Su

on we proceed line please? Yes. Operator, can Thank to participant the the you, next Randy.

Operator

from Lu Bruce Goldman Sachs. please. to one questions, ask ahead, Next Go

Bruce Lu

a you pretty good Hi. question. result. taking Thank Congratulations for my on

NT$X I pricing think market management trillion mentioned around about XXXX in a semiconductor XXXX.

XXXX XXXX? more is TSMC growth focus, as or quantitative CPU market the the the ARM-based market by for a addressable key provide example, about like or drivers such stocks have we for in what HPC, can So foundry can end color for more

Jeff Su

Okay. Bruce, summarize your question. me first let

talked we NT$X market Bruce saying is about by XXXX. So a foundry trillion have

in what So he wants the know the outlook? to and here role can also ARM-based of be key drivers including HPC, this

Mark Liu

Okay. quoted so We has model Bruce, share a and you, for Mark. our XXXX been industrial is don't specific forecast this NT$X comments. is very general to trillion with by have

growth at me system the fast the time. industry, And clear, higher and semiconductor look for XG will and if growth the And pretty it's But most believe megatrend company, we industry comment importantly, to a will the several next grow, is do foundry just on fabless if – to by growth digital will you technology However, that the transformation for in we period computing. foundry C.C. want continue continue of structural high-performance approached most the be happening. the our years. will We during leading-edge addition in increasing technology to energy-efficient this companies rate. number outsourcing the also, industry particularly high the provide mentioned faster computation believe fuel growth accelerate because a IDM

So will good have sense that, that foundry the better a growth year than we foundry – in believe industry sectors. other growth

Jeff Su

in And the of growth HPC asking outlook, about then, also role ARM? the including Bruce this

Mark Liu

new Well, a ARM is phenomenon.

I been architecture we what provided software, customers. which wider much CPU currently, provide CPU, integration Multiple architecture. no architecture And matter application think a are the dominant the they CPU all longer that of their architecture no CPUs. with architecture to better by one engaging are,

Jeff Su

first does that your Bruce, question? Okay. answer

Bruce Lu

HPC but is I growth that segment. that addressing different Can I to ask provide three understand follow-up faster is within and the five this HPC. part be how to like the like would magnitude HPC, HPC, mean in more try some Yes, years? for you which a growing growing within for the we that faster of – the big

C. C. Wei

GPU of which each we more all segment, this on again. kind Bruce, example, is Well, the for disclose what No CPU, accelerator, and cannot percentage. one is C.C. details Wei, AI

In now. all percentage, but don't we the are growing, specific for fact, they right comment

Jeff Su

Okay, Bruce?

Bruce Lu

you. Understand. Thank

Jeff Su

question? second Do Okay. have you a

Bruce Lu

Yes.

XX-nanometer, XXXX XXXX. the TSMC within and node to the all which the we biggest as utilization rate suffer XX-nanometer regarding among is and node lower is in question second that process The know

even can are when or in like financial the or XXXX? more we coming years downside of And in magnitude in you feel of like in cycle to in the expanding suggest the industry Can driver? you not the comfortable XX% a aggressive Japan how oversupply recent mention capacity were XX-nanometer. in about this capacity growth in with XX-nanometer to peak alone lot your or peers growth a like or announcement So like expand another [indiscernible] all talking TSMC, industry provide Nanjing

Jeff Su

he in Okay. expanding on also well. are expanding foundry that in he XX-nanometer XX-nanometer, said, as industry our in are Bruce's but as notes peers is – second notes capacity question the locations, that we various C.C. other also

So he to the of know guess, wants risk, I oversupply?

C. C. Wei

good question. Well,

pointed have we end you XXXX, image sensor a As just long-term technologies little in recent memory CMOS as To devices that But silicon XXXX, out bit be non-volatile multiple structural the above do supported by that It's the was to developed now, support better trend word, right in observe technologies. lower and such demand demand. at in XX-nanometer application a and one many rate. specialty in content by well other specialty this our be we utilization for to actually, enrichment multi-camera years helped in XX%.

Jeff Su

Bruce? Okay,

Bruce Lu

you. Thank Okay.

Jeff Su

you. we move please? participant, next the to Thank can Operator, on

Operator

Chan one Morgan Stanley. ask question, from to Next Charlie

Jeff Su

Hello, you Charlie. Are on the line?

Charlie Chan

Yes. Hello, hear can you okay? me

Jeff Su

can you now. go Please We ahead. hear

Charlie Chan

also Okay. for congratulations Year and New Thank results. you. And Happy good

now about also semis. example, impact economy management, consumer So like and lastly, for could the that my And crypto also volatile, also, on the right? inflationary management in crypto first has been the down. standalone it risk, mining demand. PC, away has been your TV strong demand consider seems price And fade two right? question falls very tech to demand And the would pressure years. Will For is macro

you revenue forecast? those whether like macro consider we'd full-year risk your to into kind So growth of you. Thank know

Jeff Su

Okay.

crypto of this this. demand is inflation, related PC, our address this impact question semiconductors looking also have could first fading, outlook? TV for into can have What demand to macro Charlie's the volatility. Maybe concerns and and outlook, considered end work-from-home on consumer and So at we C.C.

C. C. Wei

of security. Yes. longer chain industry's higher the end important terms factor of certain continued end period market a time devices or also the is supply the of maintain increasing to strong we momentum content But given Charlie, inventory observed supply more will and we but ensure semiconductor continue. expect level in a the silicon need the may the then slowdown a in in many adjust to units, demand in segment supporting for

to or be silicon So expect XXXX. if and the to substantial the to HPC believe tight we demand TSMC remain make content, occur, sure technology could throughout less and a application, even volatile there's due in megatrend increase we XG-related it structural leadership that of very capacity correction our will for position, our

the our about have Yes, mentioned factored currency. also own You crypto we yield.

Jeff Su

you a question? Great. second Charlie, do Okay. have

Charlie Chan

if may. I Yes,

Wendell, Thank great Or benefit a the maybe second our that that may some growth you in there's in quarter the know repeat growth, my depreciation for also, to can hike is benefits revenue will second you. sequential guidance hike reflected be XQ? first price So right? question mostly So quarter? year-on-year see And I please still price XXXX? there

Jeff Su

me your let Charlie, Okay. summarize second question.

So his question to Wendell. is directed

in In much sequential is hike subsequent reflected of price the quarter a growth, this, terms of and be will the quarters? reflected how hike first in price revenue

Wendell Huang

we're But focusing those Charlie, work continue we for customers, their also value. to on. our break what able closely That's meet you. numbers and our to are demand not sell with we down

Jeff Su

Yes. increase. And year-on-year to year low depreciation this Thank Charlie, is you. the guidance, mid-teens

Charlie Chan

Thanks. Okay.

Jeff Su

the participant you. next on we to can Thank please? Operator, move Okay.

Operator

JPMorgan. Next from Hariharan one ask Gokul questions, to

Gokul Hariharan

Happy New and Year my thanks for taking questions.

And give what first also about all, to given CapEx When That's year? particular period XX% you we think XXXX? into this the as next to little XXXX that end to could should now of range. XX% CapEx steady-state going into of higher how we out talk to to an we the more could also well, you growth Wendell, year? is like this how get a continue we peak capital on of question. bit about it in the the to us And we as about my next couple think expect grow years do expect First peak? intensity? growth maybe Do update is Or expectation

Jeff Su

first question. our CAGR our about Gokul me XX% that at summarize now is XX% outlook. your to let He several Gokul, CapEx was for me to next summarize, growth higher years. the Okay. notes asking allow

think is Is CapEx. does So CapEx for how capital terms and he next intensity? years the about look peak? few the his of the How also long-term question in should XXXX the

Wendell Huang

Hi, Gokul. Wendell. This is

guided year, this number, CapEx billion billion. to Regarding $XX we $XX

that CapEx years. next remember spent the in several growth Now we the the prospect in the for year given

whenever we there CapEx we going capital is enter is also growth discipline – give on be intensity investment continue growth intensity, And to the We're capital we appropriate. like think So outlook will period XXXX whenever good, of high the not beyond which today. will the able forward. our guidance into a and is higher today,

the if what can at were intensity see slowdown, maybe longer to remains term, mid-XXs appropriate this growth decline capital Now moment, From the level. will accordingly. we

Jeff Su

Thank mute? on Does answer you question Gokul. that Hello, you. first your Gokul? Okay. Are

Gokul Hariharan

much in this competitors, about IDM direct do doesn't given to that a business other contributor revenue understand TSMC aggressively the first your some customers My for IDM this is TSMC for how customer, of with answering foundry wanting top also the to Sorry. they and this TSMC, also TSMC. given compete question reentering one been of the HPC market of are is next How years? situation them. TSMC over bigger a market wanted customer business question. which management with foundry thinks for second are expecting Thanks has area the now for about be but navigate relationship does the head-to-head who Just to XX the couple customer

Jeff Su

who is also customer not a let second foundry this of and second IDMs IDM terms Okay. question. entering me the so us? how work specific Gokul's TSMC, with that really past, in with question the of Gokul, question do customer – also in we do his is we your is navigate summarize relationship given compete but

C. C. Wei

this C.C. Wei. is Gokul, Okay.

Let same. that also we And pace been good me emphasize TSMC's customer good support has in customers a that customer. openly That's and and operate the always the IDM all fairly. our

answer has IDM Did into consideration. for their planning own plans have question? understand taken your already we I also We our future that the and insourcing, customer capacity this

Gokul Hariharan

how to the from you is protect for fabless kind to table? ways you customer? when insourcing growth question your your this of any that I where with on Just traditional differs really understand there Is longer-term customers think wanted a deal not it

C. C. Wei

Well, very have and on capacity as demand not end do our consideration. in said, we megatrend industry customer single product. devices. based the on And I the XG and underpinned is long-term depend into market capacity of we semiconductor planning our taken any And content HPC profile, by already one the planning enrichment or this

Jeff Su

Okay, Gokul.

Gokul Hariharan

Yes. very Thank you much.

Jeff Su

Thank on you, the participant please? Gokul. next we Operator, can move to

Operator

one Shu Next Roland questions, ask to Citigroup. from

Roland Shu

Hi, very outlook. and good congrats your afternoon, good results and for good

question your customers' according due build always for past, mentioned me from you customers' change. on – also of C.C. demand you you capacity overbuild focus First is to always nodes your capacity But long-term time-to-time, profile. to in the some

before? this And time cycle? risk? at change Thanks. this to take Are of are your what's than spending you time confident how this CapEx going customers focused are CapEx plan Will So more real this why cycle spend [indiscernible] also, time any huge semiconductor from XXXX? And do forward? your you think

Jeff Su

Roland. Okay,

capacity is, according said can is His question profile. really C.C. demand Roland's customers' change. to our question that the So long-term first forecasts though we build

we can that this see confident do be? current cycle playing Roland? how correct, how out? Is we So And

Roland Shu

Yes.

C. C. Wei

Okay.

Let me answer this question.

see the to geopolitical of of structural increase actually that time, imbalance a market For the chain the interruption of tension. well XG, short-term in the and difference as as supply this brought and COVID-XX long-term demand digitalization we HPC multi-year about megatrend due industry some

in unit. in it before, we we utilization increase as and the increase have time very the at said, never Let leadership. add me and we content how say that of higher was content confident good the a structural technology because, driven This the as which reported I that one we very are, industry long-term confident semiconductor factors a because rate important

Roland Shu

Yes.

semiconductor I cycle. question your of also part a now? the question, cycle think is the of I for the What's have take

C. C. Wei

if cannot or trust right? better is predict the its manufacturing the will a in we But that excellent there be position Well, customers the we do a even believe in downturn and cycle with coming, upturn and leadership cycle. cycle, TSMC technology

Roland Shu

second forward. my better with for growth your Yes, Understood. question, Okay. faster going Thanks. and margin revenue

growth For TSMC, and forward. continuous and needs for employees more management apparently experienced capable going

retired of are your senior some However, legitimately approaching management age.

So forward? way, the And the retain manufacturers and worldwide? how and your by are what's the you going set also, the progress valuable to R&D management your experience talent going recruiting Thanks. for of

Jeff Su

Okay.

is his do around recruitment of expand manufacturing question and as How progress talent our we we Part second the footprint, Roland's And it experienced talent. what that R&D? management. also keep is is of executives? question senior really our our our senior and our global is of So engineers

Mark Liu

Mark. is this Roland,

right. You're

they treasurers Our will this company, energetic, our long as and will they capable forced forward. for bring And want contribute there's no the are as executives are and retirement. to they company

For work want with we they to if executives, those top-notch them will stay.

Jeff Su

how we our recruitment then as about And also, expand? globally talent

Mark Liu

recruitment, U.S. the local will focus deal in and reach manufacturing through this R&D. Talent pace extend and can global recruit we be manufacturing it fast may and with our operations company for particularly expansion, our see, is able you emphasized into to those also that expansion are we and overseas talent And the currently vehicle on Japan to as more the Yes. recruiting. as

So that is part of our strategy.

Jeff Su

Okay.

Roland Shu

Okay. Thanks.

Jeff Su

on Operator, to please? we the Roland. Thank next can move participant you,

Operator

Research. Arete from Simpson Brett have we one, Next

Brett Simpson

for for particularly we you prepayments also how share much. how received and the much subsidies subsidies, how how about and you we Thanks subsidies in XXXX? Wendell. account government this P&L TSMC first is you. Yes. for Wendell, think this, in account do the And Thank going do forward? and very with My XXXX, can us question should prepayments in

Mark Liu

Yes, go ahead.

Jeff Su

Sorry.

Brett's summarize to Just question.

how that we for wants know much question, financial prepayments account these we and expect our do How first do to statements? received how his he in XXXX? subsidies government in And in much XXXX? we So

Wendell Huang

Brett. Okay,

the last year, have are those US$X.X the receipts from total you first. of can about prepayment, included as customers. temporary me billion talk in At and of received statement the a financial – Let end in prepayment the we

going can find look forward, So our numbers. quarterly and that you financial at statement

to different in they As have different and countries different subsidies, forms. come incentives

them offset And record the – accounting some We in them to treatment reductions. and are are different of that of to use asset they some financial statements. reductions, follow expenses them that. of related So tax we some

Brett Simpson

XXXX. than year guess Is I fair that a this Okay. will the higher prepayments statement? Thank you, be Wendell.

Wendell Huang

are Well, that but with I we cannot share expect more. there the you details,

Brett Simpson

your silicon looking below Okay. XG XXXX, segment some it really XXXX, content which of you big at and about well will continue And in big content to it Can has your been customers. in driver talk question, business, drivers? second Thank the XXXX. Smartphone grew a you. X% my silicon is of in

wondering, and happened content So in from what XXXX I'm silicon And just about we can how think your on year? maybe just Why with in X% growth? drivers perspective us only the smartphones smartphones? you this XG should positive share

Jeff Su

Okay.

smartphone. He the platform X% question is Brett's year-on-year our that focused XXXX. notes NT dollar grew So smartphone terms in in on

his Brett, in you question, of I growth sort smartphone So guess, if higher the your despite driving the slower hearing is the correctly, what is silicon I'm question content?

C. C. Wei

of Well, that higher. it's dollars, it's mean year. but of much let increase I NT in U.S. question. And answer of silicon course, in terms content the terms me continued the only X%, every dollar, the to

growth TSMC's to the one of be So contributor that we major expect continuously. will

Brett Simpson

Okay. Thank much. you very

Mark Liu

add. The global X%. Yes, I me year about let last is growth smartphone think unit –

So pricing. company is it be optimistic. some revenue some you you smartphone as our may could due the But the to of the of understand, not pricing grow, – see strategic, strategy,

So we'll in the smartphone business. units with our grow

Brett Simpson

very much. you Thank

Jeff Su

can move caller, Operator, Brett. you, Thank Okay. on next please? the to we

Operator

Shi & one Next Charles from Company. Needham is

Charles Shi

Hi. taking Thank you question. for my

and very a NXE NX that year, have you NXE? includes first the C.C., NX NXE, about the NX number in common first family, exceed that to now tapeouts in the NX mentioned both or a NX year which of the original of I clarification. you you number and tapeouts with Just the since is quick both on expect alone think

Jeff Su

Okay.

When alone greater NX So are this tapeouts. Is year. question of than terms in Charles is its in say he we first tapeouts to wants or NX NXE? NX that plus first clarify NX

C. C. Wei

Well, and it's the later. mass NX for NXE right ready be because – one of soon, year will production technology be now will

tape-out if now of most So all of are NX. them that

Charles Shi

you. Thank

start now, profile question So for next revenue I to to my going know meaningfully NX. to potentially contribute want to on it's ask gross year. the I margin

the the quarters one smartphone the But the take time, at node. average. you about NX to is the supported of process have launch to that You've now beginning corporate newest – this right past eight said and node seven in of HPC the at being I about NX that difference reach the will both think

one So on you. my shorter. parallel smartphone become process and question. comment of another And after NX, guess newest that which the is revenue maybe help could could seven really that revenue. your my whether go ramp for from will starting of the it could the instead Thank and That's you your really node, HPC volume, quarters eight to dilution margin of

Jeff Su

Please you, second summarize allow Thank to me your question. Charles.

the – it know smartphone and So He at at platform. both in margin. the you HPC past profitability observes typically have corporate and to the eight average, to both developed and second is NX, question seven NX reach takes Charles looking quarters But we gross

parallel, in So time? the average ramp of NX actually in shorter duration could a reach corporate these

Wendell Huang

stage too volume Okay. not gross average the to Charles, at this reach early is yet. can as It Wendell. when has is NX margin the production say this corporate started

even always process for challenging, outlook such node However, as NX of the every leading brings looks complexity initial increasing new greater and challenges. nodes the

will work cost profitability we We value returns. right the continue to and our ensure that earn to improvement selling on and

Jeff Su

that Okay. second Charles, does answer question? your

Charles Shi

Yes, indeed. Thank very much. you

Jeff Su

Thank on move we the can to Operator, please? participant, Okay. next you.

Operator

ask to Mehdi SIG. one Hosseini Next from questions,

Mehdi Hosseini

for my taking Thanks Yes. question.

on follow-up a is the gross actually one first The margin.

your quarter, the XX%. you're For margin guiding longer-term but gross to around to XX% March is XX%,

operating the trend that And does long-term look should that beyond a about follow-up. And we have I QX, margin? the So how as is think mean gross in a we there also, downward margin?

Jeff Su

Okay.

saying margin our outlook implying But quarter is asking, guidance gross gross margin. the first question around year He me So higher the But guidance rest let of first will or margin. long-term the therefore, margin gross decline. is for come gross nonetheless, XX% Mehdi's XX% margin and down is to our are clarify, Mehdi notes is we Mehdi, XX%.

Wendell Huang

Okay. cost, the foreign our utilization Mehdi, this for margin The factors be exchange and of is of six price, foreign our rate. factors talk reminded advanced the but hard control there are cannot Wendell. that the subsequent year, predict. please to that and and prepared profitabilities. we ramp gross quarters mix, technology, development affecting about We're not Those include exchange rate to something is outlook

the gross higher. saying expect summarizing So and together, our XX% margin we we're to that long-term, those all factors be

we're operating of margin, to giving out not the operating as our now. margin As guidance

Mehdi Hosseini

also help of us process and you. And Thank by versus five how technology seven, the revenue Okay. three mix like quick a understand will Can follow-up. you change in XXXX? XXXX

Jeff Su

asking second different is how NX, what node. versus is be NX is that contribution will in XXXX? contribution that that And revenue asking Okay. by Mehdi's and question XXXX? NX, He

Wendell Huang

revenue the not today, but to the breakdown Okay. the continue give node prepared Mehdi, by contribution we're for to ramp. will NX

So we revenue contribution the rise expect the to throughout to year. continue

Jeff Su

Yes. in think I XXXX. the will volume to And see and second start the in will contribution you we Mehdi, begin production half NX before, revenue have XXXX, said that

Mehdi Hosseini

on great Okay. Great. Congratulations execution.

Jeff Su

Okay. Thank next participant? move can we Operator, the Mehdi. to you,

Operator

Next questions, one from to ask Sunny Lin UBS.

Sunny Lin

afternoon. Thank New my Happy question. you for Hi. Good Year. taking

So NX. my first question on is

that So the than you NX NX for the mentioned higher first of in tapeouts is number year.

with the And now give mass we year if of pretty compared close also, to getting NX capacity are the contribution production, first outlook revenue could of So that your sense overall on NX us sense you the production? NX? any in mass want to get for I

Jeff Su

Okay, Sunny.

NX? is to first on me or allow your NX than a capacity NX. Her please summarize – question. question scale higher have Will me let So

C. C. Wei

customer is C.C. be on our engagement, and and I NX just long-lasting capacity NX. large with NX the like Wei. but would and say for another by able a like strong to will comment Well, node node, specific this TSMC not I'm interest to level of

Jeff Su

also contribution is asking NX? revenue Sunny the then of about And

C. C. Wei

still It's about. talk early to too

Sunny Lin

Sure.

C. C. Wei

Yes.

Sunny Lin

No problem.

only follow-up production. XXXX, if the we in is be about the second wave about I which occur to seems two customer after So years will that NX think a ramp-up, think adoption mass

think could Would of about the HPC, a up bit HPC? pick faster Looking contribution you. like? ramp-up faster of at NX, could be adoption scale and what the with because Thank higher you help us

Jeff Su

question And greater of Okay. ramp-up? HPC is question she a notes her and from higher but years wave with second NX, initial the Sunny’s that NX after is two the and in see the would second occurred NX. NX faster customers, also on production, adoption interest

C. C. Wei

engaged all NXE NX, can I say now in with our the what Well, we customers more NX. quite right are than observed is

say. to very too ramp that. is All it's However, up, that how early engagement can to The I quantify strong. say

Sunny Lin

is quick ramp any supply. EUV seeing for for follow-up Maybe NX considering capacity potential years, a you especially Sure. the for equipment next bottleneck a tools? up few ASML's larger disruptions you very to Are potential

Jeff Su

Okay.

capacity capacity potential EUV of in bottlenecks terms particularly So expansion, last are we plans, terms of from question Sunny seeing is in any our our that in or tools? bottlenecks ASML's

C. C. Wei

now can we question. now working I we that very good customers' the so up is All capacity can we is on are that meet And a ramp XXXX, okay. say demand. this are Sunny to right XXXX,

Sunny Lin

very you Thank it. much. Got

Jeff Su

Thank you, please? the on to Sunny. move next Operator, participant, let's

Operator

have Next Berman one, from Neuberger we Sebastian Hou

Sebastian Hou

Hello. you hear Can me?

Jeff Su

Yes. We can.

Sebastian Hou

only Yes. This have of is question. Hello. mathematic my Thanks for taking I more one. question. a

look I kind years equation. you’ve of three in at So CapEx long your or double to X.Xx, which like – probably years, revenue your means looks five CapEx around that your used It to did you the how double triple TSMC if your more on there translate that in revenue? similar you'll your or

relationship out CapEx you if where that then is XXXX numbers your at In in So to whether translation kind And around, CapEx. start where move your years, – or you I'm hold. is time quadruple look curious four I time three CapEx. XXXX of in about And you triple years, this aggressively. CapEx you

hold, So next that CAGR, XX% XX% not if billion revenue revenue your the XXXX to your actually exceed to four that does or US$XXX XXXX, which three, XX%, US$XXX but to that just over means revenue And equation years will – XX%? your be XXXX to that mean by billion. by billion continue will around then you're US$XXX long-term

Jeff Su

He CapEx really how five led the in long is three of on revenue. CapEx question observed revenue. does and Okay. the in Sebastian’s doubling past his He calculations, about it years years. relationship CapEx in into revenue between translate asking to course, is the about to that doubling take

time he can apply if in TSMC US$XXX this tripled from expect you CapEx wants billion. Sebastian, he XXXX, then to now said So it XXXX? well, to revenue has be to to say,

Sebastian Hou

XXXX. Yes.

Jeff Su

kind of to in So XXXX, US$XXX billion XXXX. billion US$XXX billion US$XXX level in

Wendell Huang

several math is, of ourselves. earlier in that Well, the kind is we C.C. do speaking, frankly, to Wendell. what XX% today, didn't But mentioned XX% CAGR our years. as next Sebastian, its Okay. this guidance

CAGR numbers. of a that that grow will kind also its next several year And So doesn't every longer-term mean years is numbers.

try the not used. think. to that mathematics you that would not just use are simple, I I So Things

Sebastian Hou

me or now versus But a not another do getting you. Is or five any XX is that maybe slower way Definitely or that the faster of years bit pace? that Thank Yes. ago? kind you the see translation the let change revenue time, or simplify put CapEx it on to simple. question same the

Mark Liu

ahead. go Yes,

Jeff Su

Yes.

So longer? seeing of revenue. Are pace same I to in Is try terms past? to this. the at Chairman the it address shorter? is to it asking, I it as it we in CapEx Is getting Sebastian so think simplify getting think can

Mark Liu

answer me this. Let

longer. time of the the I longer is complexity equipment think lead is also technology because much and

So that time a terms in leading lead the increase might to of bit little revenue.

Sebastian Hou

That's Okay. Thank you. fair. all me. That's for

Jeff Su

participant, next you, Operator, please? move Sebastian. Thank the Okay. can on we to

Operator

please. have Next we Laura KGI. ahead one, Chen from Go

Laura Chen

Happy I my for you. Thanks Thank have taking on Hi. overseas New question. questions Year. your expansion.

my prefer wondering owned your joint Japan? what's first TSMC Just preference? what in venture like Do TSMC would venture announced before? more in you and for potential be XXX% That’s Europe did joint a or with time current in long what you you ago And question. open Singapore like consider WaferTech would NXP

Jeff Su

Okay.

it's JV and So first as consider question. have she's about we Japan, going wondering WaferTech your something new forward? with forward, will Laura, that in Europe done summarize model venture let and also is elsewhere? a Is fabs, future whether going our joint past with model the overseas we recently is or It the this in me

Mark Liu

very Among Mark. the fab, stage considerations. answer To Europe, are many overseas start this the the first Yes. is customers' To is is is – early assessing. Laura, them many, still this needs. – there top we about question few are your our first

was Japan the indeed, venture. joint a in it planning fab, current this in so And

same. also And done joint located, joint no the where Japan serve customers will from for also haven't it's We this venture many case. venture the is world and venture TSMC fab the special we think joint years. this matter a every all around Typically, were we

help and experience a Japan, Japan, in large and have technology, leverage single curve. can – we we have ramp However, very a their operating us a learning in manufacturing the in is customer who which also

made majority that joint venture a us with share. we Sony, have the a of fab make decision So where

considered special a are typically, ownership. And proceed case. is we we this fab a solely-owned to XXX% with So

Laura Chen

major XX-nanometer the engagement the RF? give or XX-nanometer clear. what recall Yes. NX-based which become transceiver for that Thank on transceiver, limited for expansion transceiver? supply, technology also [indiscernible] NX-based and XG about area you TSMC's would XG. very the us the just client the not for question back in my curious And more that Can are you. you node June NX-based second RF the that much Thanks. or That's RF the know And is also, XG NX-based I transceiver, RF specifically that capacity update in in mainstream the with year, on mentioned as there's plan last we this

Jeff Su

try XG. is RF me She to major transceivers to question to expansion. Her for summarize. be doesn't know there let about wants any capacity seem Laura, Okay.

You're also XG RF sorry, So what for is TSMC's NXX strategy Laura? for and NX, transceivers or NX? talking

Laura Chen

But understanding. my right difference. now, XX, because in Yes. is not of much most there that transceiver NX are

Jeff Su

wants our she on NX transceiver. RF So update to

Laura Chen

Thank Yes. you much. very

C. C. Wei

right. are transceiver which to best Laura, product start we decision Okay. design always our you to and technology right? XX-nanometer from is customers XX makes NX. their the choose are now node to their And and with now, working closely, moving customer moving to match and Right

to capacity the answer our all your question? I say. expanding demand. can meet Did are That's that We

Laura Chen

Yes. Thank you.

will or – will sometime, RF we say, I NX-based XXXX in majority follow-up be the think, expect XXXX? that that can I

Jeff Su

So or be is, Laura's RF we expect the to XXXX? can by NX follow-up XXXX majority

C. C. Wei

should I Laura comment is not between customers. TSMC's This the that. and on Well, TSMC

Laura Chen

Thank Got much. very you it.

Jeff Su

two we'll Okay. questions. of think Thank I the Operator, final in interest time, you. take the

Operator

Next one to Company. ask and questions, Krish Cowen Sankar from

Krish Sankar

results. strong first couple it said will question over gross margins. is taking said on you and long-term Yes. about last you the Thanks The congrats on of gross margin Wendell, quarters, really XX%. for question be XX%. the My

cyclical? gross term in are increase CapEx that first these the up, That's big it's gross are since not safe margin? it is given impact other on the are there depreciation price is And increases And but play is the improvement an to variable in structural having my the question. that in assume longer some they So interesting or margins? reason margin going for this is gross

Jeff Su

let Krish, question. summarize Okay. your me first

notes Wendell and we Krish C.C. said So our target, said, margin last that and XX% time long-term higher. gross

and Now we XX% said today, higher.

higher target? is is only? XX% Or this a there terms this gross higher of And of structural element is margin something and price? in So because cyclical a long-term

Wendell Huang

me you Yes. let share that. Well, with

We are long-term. talking about

down years road. the So several

I a be think issue. that shouldn't cyclical

it's previously, and long-term higher. XX% So

XX% Now it's and higher, long-term, okay.

working customers And both our difference. So drive and with that's value improvements. our the our closely are and to sell cost we suppliers

So this – of those the together. are all the is these result efforts

Krish Sankar

And is Can the growth? talents of you in breakdown And don't to side, rising Arizona, right. of understand my growth I'm the geographic about global OpEx. recruiting $XX interest tell two kind like The $XX part going Taiwan billion spoke and question question, OpEx how much $XX is CapEx. then it's All your OpEx you Got Japan, in to U.S. that just curious, But to a CapEx between kind a split to second you billion? long-term comment inflation question. want just to in OpEx $XX be then and billion it. think billion inflation us and how of to CapEx and on on about of relative I the

Jeff Su

Okay.

question. second Krish’s So

billion. year, know compared wants billion is CapEx we the He guidance to gave First to to capacity what of for Taiwan. terms overseas is $XX as in that $XX portion this

Wendell Huang

Okay.

cannot and $XX mature and split year, split we between overseas between or guidance advanced and of comment nodes. billion the give this $XX on specialty normally the breakdown really out billion, For We don't – Taiwan. the

Jeff Su

then rising – for operating outlook OpEx? we're is we're part inflation, but global is What the And margin second to recruit OpEx. although giving not the impact the an What overseas. trying is our on guidance, talent

Wendell Huang

expenses operating try very leverage. achieve hard we and control work to very to hard, Well, our operating

continue track past on. that leverage. very to will that's always hard able You and the can something work probably we're few that operating in see And past record years from we the to quarters achieve few

Krish Sankar

Okay. you much. very Thank

Jeff Su

Krish. participant's Okay. will we take questions. Thank time, Operator, of the interest in last you, the

Operator

Lee Frank questions, ask to one from ahead, please. Last Go HSBC.

Frank Lee

All you taking right. question. Thank for the

Just had a can CapEx. question, the maybe if I on follow-up

CapEx gave ago, only a I given is a CapEx you your or for term year fee understand think at XXXX. time, I longer target. this guys

XX% there understand going being uncertainties not going the or intensity given? in the the it about are Just giving quarter that to your is CapEx last wanted you Is you was in to the the years. XXs. guys That's CapEx any I to think question. I that XXXX, have the we're to still seeing but down it there XXs that more was long-term longer-term than three target And case? in about – target was last in said the two longer-term next But talked implied more think also not first come quarter, be

Jeff Su

Okay.

now? three next next in question is for So Frank's years we talked first His years. are billion we He guiding CapEx there CapEx. said some had question have? is not on about $XXX CapEx the concern Is three why we

Wendell Huang

Okay. Please we is not year, on the CapEx of will that beyond spent reminded be Frank, every anticipation growth XXXX to date. outlook comment CapEx follow. will our in that the

customers approach, we support yes. disciplined regarding opportunities. our the our growth outlook the intensity, as good, as So continue long approach the And then as will capture capital looks investment investment our to growth and

growth the high the then capital were is is decline to quite growth our As intensity normal intensity of to be it today, And in slowdown, or the accordingly. expected high. if period it I like said earlier appropriate capital that for to is

several So be or normal what you're from asking will from a probably moment, we this now can situation the mid-XXs. see probably at in – years

Frank Lee

likely years? two it's level? further out be Okay. we three to in next get could But that at that is or going the Or

Wendell Huang

years. Long-term, several

Frank Lee

you. Okay. Thank

Jeff Su

think year-by-year we'll Yes. updates. you I give

Okay?

Frank Lee

semi I then a message this content on growth. second Okay. call structure, Great. semi about content And my guess question I really was think, the is, consistent

guys think a this you this call. have couple I times of in mentioned

for well to in semi past has incremental the been maybe wanted just content you guys growth? a are by long-term semi though, the mature over that understood. we year like an something share seems application? been positive growth has you your terms so, if it's nodes Over the structural well? year And of growth, as Or and that of there the surprise content content can seeing sense what But past I more get guess,

Jeff Su

Okay.

semiconductor year? driving enrichment. upside are is are last of is content what question Maybe we on And the C.C. second the we can seeing? last applications Frank's in His this in specific seen the So address terms question. semiconductor Have question what enrichment.

C. C. Wei

live a you give example. will I sure. Yes,

has market, new been et you If being find the And out look and will the introduced content same you at to the car increased. happened cetera. in the data centers, cetera, that dramatically server et semiconductor

Frank Lee

then Okay. that the [Indiscernible] that semi across the it to specialty… content growth all of some is as structured something fair including say is well advanced nodes, is as

Jeff Su

So Will with the only true at also this is the as Frank's well? – the this this for question mature also leading then nodes? hold nodes is enrichment, semiconductor

C. C. Wei

can give that say. the it’s one example, you technologies Well, I across I'll again. all

technology, you that's that's management, a the mature technology. leading-edge If if a at at the ADAS, power look look you

Jeff Su

you. thank Okay. right. All Frank,

Frank Lee

Okay. Thank you.

Jeff Su

This our Thank you, you, concludes Frank. Q&A Thank C.C. session.

hour TSMC's Before transcript be the are we at hours now. replay that will conclude be will to through conference website be now. The become available the within going available please www.tsmc.com. accessible of from conference, today's XX from one advised Both

you So us again next for quarter. healthy us safe. and joining hope We stay continues have good and everyone thank and Year we Goodbye, to join Happy hope day. New a today. you