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TSMC capital spending to fall this year – and next

Still no sign of chip market rebound

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Intel may be resolutely sticking to its 2001 capital spending target of $7.5 billion, but few of its rival chip makers are sticking to their own projected levels of spending.

TSMC certainly isn't. Speaking at the International Symposium on Semiconductor Manufacturing in San Jose last week, company chairman Morris Chang said that the company will have spent some $2.2 billion on new plant and equipment this year, well down on the $3.4 billion TSMC spent in 2000.

Next year, the world's largest chip foundry will be even more thrifty. "I expect our capital expenditures in 2002 will be even less [than 2001]," Chang admitted, though he declined to put a figure to it.

This despite the upturn is sales TSMC has recorded since the end of the second calendar quarter. The company recently said it expects its Q3 sales to be significantly higher than those recorded in Q2, with net income growing fourfold. And Chang reiterated that Q4 will be better than Q3.

But not that much better, and certainly not sufficiently so for the company to make confident predictions for 2002. "I don't know when the robust recovery will happen," Chang said. He's certainly not anticipating it any time soon, if his expectations for the company 2002 capital spending is anything to go by. ®

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