Taiwan Semiconductor Manufacturing
Q4 2022 Earnings Call
Jan 12, 2023, 1:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Jeff Su
Good afternoon, everyone, and welcome to TSMC's fourth quarter 2022 earnings conference call. This is Jeff Su, TSMC's director of investor relations and your host for today. TSMC is hosting our earnings conference call via live audio webcast through the company's website at www.tsmc.com, where you can also download the earnings release materials. If you're joining us through the conference call, your dial-in lines are in listen-only mode.
The format for today's event will be as follows. First, TSMC's vice president and CFO, Mr. Wendell Huang, will summarize our operations in the fourth quarter 2022, followed by our guidance for the first quarter 2023. Afterwards, Mr.
Huang and TSMC's CEO, Dr. C.C. Wei, will jointly provide the company's key messages. Then TSMC's chairman, Dr.
Mark Liu, will host the Q&A session where all three executives will entertain your questions. As usual, I would like to remind everybody that today's discussions may contain forward-looking statements that are subject to significant risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Please refer to the safe harbor notice that appears in our press release. And now, I would like to turn the call over to TSMC's CFO, Mr.
Wendell Huang, for the summary of operations and the current quarter guidance.
Wendell Huang -- Vice President and Chief Financial Officer
Thank you, Jeff. Happy new year, everyone. Thank you for joining us today. My presentation will start with financial highlights for the fourth quarter and a recap of full year 2022.
After that, I will provide the guidance for the first quarter 2023. Fourth quarter revenue decreased 1.5% sequentially in U.S. dollar terms as our business was dampened by the end-market demand softness and customers' inventory adjustment despite the continued ramp-up of our industry-leading 5-nanometer technologies. It is at the low end of our previous guidance.
In NT dollar terms, revenue increased 2% in the fourth quarter due to a more favorable foreign exchange rate. Gross margin increased 1.8 percentage points sequentially to 62.2%, mainly due to a more favorable foreign exchange rate and cost improvement efforts, partially offset by lower capacity utilization. Total operating expenses accounted for 10.3% of net revenue. Operating margin was 52%, up 1.4 percentage points from the previous quarter.