TSMC Reports First Quarter EPS of NT$1.10

Hsin-Chu, Taiwan, R.O.C., April 29, 2008 -- TSMC today announced consolidated revenue of NT$87.5 billion, net income of NT$28.14 billion, and diluted earnings per share of NT$1.10 (US$0.17 per ADS unit) for the first quarter ended March 31, 2008.

Year-over-year, first quarter revenue increased 34.8% while net income and diluted EPS increased 49.4% and 54%, respectively. On a sequential basis, first quarter results represent a 6.8% decrease in revenue, a decrease of 18.4% in net income, and a decrease of 16.4% in diluted EPS. All figures were prepared in accordance with R.O.C. GAAP on a consolidated basis.

First quarter business followed a normal seasonal pattern, but revenue and margins were negatively impacted by the strength of the NT dollar. The 2.6% average appreciation of the NT dollar reduced revenue by 2.6% and reduced gross margin by 1 percentage point. The resulting gross margin was 43.7%, operating margin was 33.3%, and net margin was 32.2%.

Advanced process technologies (0.13-micron and below) accounted for 63% of wafer revenues with 90-nanometer process technology accounting for 28% and 65-nanometer reaching 15% of total wafer sales.

“First quarter was a good quarter. The results were in line with guidance, in spite of the higher than forecast appreciation of the NT dollars against the US dollars. In addition, we began implementing a new ROC accounting rule which requires the expensing of employee profit sharing, ” said Lora Ho, VP and Chief Financial Officer of TSMC. . “Based on our current business outlook, management’s expectations for second quarter 2008 performance are as follows”:

· Revenue is expected to be between NT$87 billion and NT$89 billion;
· Gross profit margin is expected to be between 43% and 45%;
· Operating profit margin is expected to be between 32% and 34%.

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