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The big picture: The world's largest contract manufacturing and design company is seeing signs of slowing consumer demand for certain electronics as geopolitical uncertainties and pandemic-related lockdowns in China persist. It's not a real concern for Taiwan Semiconductor Manufacturing Company, however, as the outfit is already dealing with more orders than it can fulfill.
TSMC Chairman Mark Liu said demand for smartphones, PCs and televisions is waning, especially in China. Part of the problem is the fact that costs for components and materials are on the rise due to supply chain issues, pushing up production costs in the process. "Such pressure could eventually be passed on to consumers," Liu noted.
It's not all doom and gloom, however, as Liu said TSMC continues to see robust demand for high-performance computing components, Internet of Things devices and components for the automotive industry.
The executive added that they still are not able to meet customers' demand at current capacity, which will force the company to reorganize and prioritize orders for areas still experiencing heavy demand.
In January, TSMC said it expects to grow by at up to 20 percent (in US dollar terms) this year and will spend upwards of $44 billion to boost capacity in 2022.
TSMC's observations jive with what we've heard from others as well. A report from Nikkei Asia earlier this week claimed Apple has asked suppliers to cut production of the new iPhone SE by as much as 20 percent due to lower-than-anticipated demand.