TSMC Reports Third Quarter EPS of NT$1.18

Hsin-Chu, Taiwan, R.O.C., October 30, 2008 -- TSMC today announced consolidated revenue of NT$92.98 billion, net income of NT$30.57 billion, and diluted earnings per share of NT$1.18 (US$0.19 per ADS unit) for the third quarter ended September 30, 2008.

Year-over-year, third quarter revenue increased 4.5% while net income and diluted EPS increased 0.7% and 4.9%, respectively. On a sequential basis, third quarter results represent a 5.5% increase in revenue, an increase of 6.3% in net income, and an increase of 7.5% in diluted EPS. All figures were prepared in accordance with R.O.C. GAAP on a consolidated basis.

Third quarter business saw an improvement from the previous quarter with demand grew across all major semiconductor applications, although business turned weak during the quarter. Third quarter gross margin was 46.3%, operating margin was 35.4%, and net margin was 32.9%.

Advanced process technologies (0.13-micron and below) continued to grow and accounted for 66% of wafer revenues with 90-nanometer process technology accounting for 26% and 65-nanometer reaching 25% of total wafer sales.

“With global financial markets going through unprecedented turmoil and world economy in a high state of uncertainty, most our customers are aggressively paring their inventories and have thus reduced significantly their wafer demand,” said Lora Ho, VP and Chief Financial Officer of TSMC. “Based on our current business outlook, management expects overall performance for fourth quarter 2008 to be as follows”:

· Revenue is expected to be between NT$69 billion and NT$71 billion;
· Gross profit margin is expected to be between 34% and 36%;
· Operating profit margin is expected to be between 21% and 23%

# # #