Macquarie's research report indicates that it is expected that Taiwan Semiconductor (TSM.US)(2330.TW) will exceed profit margin expectations in the fourth quarter of 2024, mainly due to the surge in high performance computing (HPC) Orders. However, the report also mentioned that with increased uncertainty regarding mainland high performance computing orders and reduced exposure to the mainland market, profit margins are expected to return to normal levels starting from the second quarter of 2025. The report states that major customers may reduce Orders, leading to a possible quarterly decline in revenue in the first quarter of this year.

The report indicates that Taiwan Semiconductor's overall growth potential is positive, maintaining an "outperform" rating, with the target price for **** stocks lowered from NT$1,500 to NT$1,450. The report also adjusts the company's earnings per share forecasts for 2024 to 2026, increasing by 1%, decreasing by 3%, and decreasing by 7%, mainly reflecting this year's revenue challenges and the return to normal profit margins after a decrease in urgent Orders from NVIDIA (NVDA.US). Additionally, the company's capital expenditure forecasts for this year and next year have been raised to $37.5 billion and $43.5 billion, respectively, with capital expenditure intensity expected to remain stable. (vc/u)

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