Shares in Taiwan’s TSMC fell more than 3.67% on Wednesday after regulatory filings showed Warren Buffett’s Berkshire Hathaway slashed its stake in the chipmaker.
Berkshire cut its position in Taiwan Semiconductor Manufacturing Co (TSMC) by 86.2% to 8.29 million sponsored American depositary shares, a regulatory filing showed.
That comes roughly three months after Berkshire unveiled it bought more than $4.1 billion worth of TSMC stock.
TSMC depository receipts fell 4% in the US after hours trade on Tuesday. In Taiwan, TSMC shares opened down 3.3% as Asian markets started Wednesday trading.
Depositary shares in TSMC have surged almost 32% this year, closing at $97.96 on Tuesday.
“Berkshire made a small profit on TSMC. It was not a huge, huge win for Berkshire,” CFRA Research analyst Cathy Seifert said. By her calculations, Berkshire bought the shares for roughly $68.50 and sold them for $74.50.
It is rare but not unprecedented for Berkshire to quickly undo a multi-billion dollar investment in a company’s stock.
The move comes after TSMC, the world’s largest contract chipmaker, warned last month that its revenue in the first quarter is likely to dip 5%.
A softening consumer demand for electronics has fuelled a global downturn in the chip industry. TSMC executives have said they do not expect market conditions to improve until the second half of the year.
Besides TSMC, Buffett also divested from several US-listed banking and gaming shares, while bolstering its holdings in iPhone-maker Apple.
$3.5-billion boost for Arizona chip plant
TSMC said on Tuesday its board had approved a plan of capital injection of up to $3.5 billion to its unit in Arizona.
In December, TSMC tripled its planned investment at the Arizona chip plant, which began construction late last year, to $40 billion.
The company said the capital injection is part of the planned $40 billion being spent.
The factory, among the largest foreign investments in US history, is due to start production in 2024, using advanced 5 nanometre technology.
TSMC expects its Phoenix factories to create 13,000 high-tech jobs, including 4,500 under TSMC and the rest at suppliers.
- Reuters, with additional editing by Vishakha Saxena