Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), the world’s top contract chipmaker, saw its profit nearly double in the first quarter, as strong demand for telecom and high-end computing chips helped it defy a coronavirus-induced downturn seen in many other sectors.

In the three months through March, TSMC’s net profit jumped 90.6% year-on-year to NT$117 billion ($3.89 billion), beating market expectation for a NT$108 billion profit, according to the company’s earnings report released on Thursday. Revenue jumped 42% to NT$311 billion during the period.

TSMC attributed the strong profit to growing demand for chips related to 5G smartphones and high-performance computing.

During the January-to-March period, nearly half of TSMC’s revenue came from sales of handset chips, while 30% was associated with high-performance computing. The remainder came from sales for chips used in the internet of things (IoT), consumer electronics and automotive electronics, according to the company.

Sales for chips using 7 nm technology contributed more than a third of TSMC’s total revenue in the quarter. But CFO Wendell Huang said the company’s more advanced 5 nm technology moved from the research and development stage to mass production in the first quarter, pulling down its total operating expenses by NT$2.6 billion during the quarter.

Meanwhile, TSMC said it expects its second-quarter revenue to reach between NT$304 billion and NT$313 billion, roughly the same as its first-quarter figure.

Contact reporter Ding Yi (yiding@caixin.com)

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