TSMC sees weak global economic growth over next year

Reuters News
Posted: Oct 12, 2011 1:34 PM
TSMC sees weak global economic growth over next year

TAIPEI (Reuters) - TSMC, the world's top contract chip maker, expects weak growth in the global economy over the next 12 months, its chairman said on Wednesday.

"You can be assured that the economies of Europe, the U.S., Japan and China will not be good over the next year," chairman Morris Chang said at a business event.

Taiwan Semiconductor Manufacturing Co (TSMC), whose major clients included graphics chip maker Nvidia Corp, and other major chip makers have been hurt as the euro zone crisis and a weak U.S. economy softened demand for technology products.

Dutch chip equipment maker ASML on Wednesday said it saw signs of slowing growth in the semiconductor industry, except in the technology needed to produce tablets and smartphones, and avoided making predictions for its own performance next year.

TSMC and United Microelectronics Corp last week posted big drops in September revenues after demand weakened as customers adjusted inventories, though for the quarter as a whole the numbers met expectations. [ID:nL3E7L70VJ]

Analysts expect the downward trend in the two companies' revenues to continue, with 10-20 percent drops in the fourth quarter from the third as big clients slash orders for December.

Around one hour into trade, TSMC's ADR rose 1.43 percent in New York trading, roughly in line with the Nasdaq Composite Index.

(Reporting by Argin Chang; Writing by Faith Hung; Editing by Helen Massy-Beresford)