When Taiwan Semiconductor (TSM) posted a mixed fourth quarter, the stock rebounded. Its report included a 2023 spending cut, easing investor worries. TSM, which makes chips for Nvidia (NVDA) and AMD (AMD), might surge too.
TSM posted earnings a share of $1.82 on $19.93 billion in revenue. Revenue rose by 26.6% Y/Y, beating expectations. It said that advanced technologies (7 nanometers and lower), accounted for over half of its wafer revenue.
TSM will cut capital expenditure from $32 billion to $36 billion in 2023, citing lower demand. This cost cut will sustain TSM stock’s uptrend, whose stock price bottomed at below $60 in Nov. 2022.
AMD, which makes computer chips, could trend higher. The firm refreshed its Ryzen line-up. However, consumers opted for the last-generation 5600 CPU. This cheaper upgrade will steer AMD to lower the prices of its latest products.
Nvidia (NVDA), which warned investors it would sell fewer graphics cards, benefits from TSM’s cost cuts. The firm released 4090 and 4080 GPUs at a premium price and on limited supply. After clearing the RTX 30 series inventory in the channels, Nvidia will increase production of its latest chip.
NVDA stock already bottomed at below $120. The uptrend could continue as investors bet its prospects recover this year.
