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I wonder what the internal cost is for TSMC to do a wafer is? The variable cost if you will: The cost of materials, electricity, staff etc.? Probably a very sm
by throwaway4good 6y ago
I wonder what the internal cost is for TSMC to do a wafer is?
The variable cost if you will: The cost of materials, electricity, staff etc.? Probably a very small amount.
The big cost for TSMC is the fixed cost of the expensive equipment and the massive R&D in developing the process. However the amount is interesting since if you wanted to spend a massive billions of dollars and setup a competitor to TSMC, you know that TSMC would be able to compete with you on price all the way down to that point.
- lowdose 6y agoYou can look at ratios like WACC and ROIC. TSMC's weighted average cost of capital is 7% (WACC) ROIC % measures how well a company generates cash flow relative to the capital it has invested in its business. For TSMC the ROIC is 28%. If you would like to compare competitors these ratio's combined with growth rate give a very good market overview. https://www.gurufocus.com/term/wacc/NYSE:TSM/WACC-/Taiwan-Semiconductor-Manufacturing https://www.gurufocus.com/term/wacc/NYSE:TSM/WACC-/Taiwan-Se...
- ksec 6y ago>The variable cost if you will: The cost of materials, electricity, staff etc.? Probably a very small amount. You will actually be surprised electricity is an important cost factor along with Materials in COGS.
- Arnt 6y agoThat 5nm process is the world's smallest, which means that the variable costs include a) purchasing the purest of pure materials and b) working on them in the cleanest of clean rooms. Neither sounds cheap to me.