A reported slump in cryptocurrency mining has caused lowered demand for mining hardware, and in turn caused a lower outlook for the world’s largest semiconductor foundry company.
Taiwan Semiconductor Manufacturing Company Ltd (TSMC) cut its revenue forecast from 15% down to 10%, blaming “uncertainty in cryptocurrency mining demand” along with “smartphone weakness” for the cut.
TSMC explained that the crypto mining demand started off strong in the first quarter so they expected the same for the second quarter. However, given the reported demand slump, the company expects a weaker demand for its 28-nanometer product line that is used for crypto mining hardware.
The company, as it produces chips for big companies like the mining giant Bitmain as well as Nvidia and Apple, is expected to have 10% of its revenue depend on cryptocurrency mining demand.
2.8% of the company’s total revenue last year was from cryptocurrency mining chip production. Though the percentage may be small, it amounted to $900 million. With regards to their current forecast, instead of expecting $8.8 billion, they estimate their revenue to be only around $7.9 billion.