TSMC Monthly Sales Report – December 2002

Hsin-Chu, Taiwan, January 9, 2003– Taiwan Semiconductor Manufacturing Company Ltd. (“TSMC” or “the Company”) (TAIEX: 2330, NYSE: TSM) today announced that net sales for December 2002 totaled NT$11,278 million, while revenues from January to December 2002 totaled NT$160,898 million.

TSMC Spokesperson Mr. Harvey Chang noted that the Company’s book-to-bill ratio was above 1.0 in both November and December 2002, indicating steady growth in orders. However, TSMC realized a decrease in unit sales for December 2002 as the holiday season drew to a close, resulting in a 22.7% revenue decline compared to the month prior and a 3.9% decrease on a year-over-year basis. The Company's sales revenues from January through December 2002 represented a 27.8% increase over the corresponding 2001 period.

Mr. Chang noted that net sales for the fourth quarter of 2002 were slightly higher than those for the third quarter because fourth quarter revenues came partially from inventory for the end of the third quarter of 2002. The Company’s utilization rate was 61 percent in the fourth quarter of 2002 as previously forecast, although relatively low over the third quarter of 2002. Gross margins are expected to decline five to six percentage points over the same period.

Sales Report: (Unit: NT$ million)

Net Sales

2002(1)

2001

Growth

December

11,278

11,733

-3.9%

January through December

160,898

125,888

27.8%

(1): Year 2002 figures have not been audited.