Taiwanese chip behemoth TSMC reported an unexpected jump in first-quarter profits on Thursday, tempering concerns that it would be hit by a slowdown in global demand. Taiwan Semiconductor Manufacturing Company operates the world’s largest silicon wafer factories and produces some of the most advanced microchips used in everything from smartphones and cars to missiles. It is regarded as a global economic bellwether because its chips are used in such a wide array of devices. Net profit for the first quarter of 2023 hit TW$207 billion (US$6.8 billion) compared to TW$203 billion for the same period a year earlier, a 2.1 percent increase. But the figure was 30 percent short of record fourth-quarter profits of US$9.7 billion posted in January. At the time, TSMC had said it expected a slowdown in sales. Analysts had also predicted a drop, saying the company would likely fall short of its 2022 Q1 earnings. CEO C. C. Wei said Thursday that the company’s second-quarter performance would be impacted by slowing consumer demand. “While we forecast only a gradual recovery for the semiconductor industry in the second half of 2023, TSMC’s business in second half of this year is expected to be stronger than the first half, supported by customers’ new product launches,” Wei said at an earnings call. The company has been hit by an ongoing economic slowdown dampening demand as well as a raft of US export controls aimed at preventing China from obtaining advanced chips. Despite continuously reporting high profits, TSMC saw billions wiped from its valuation as shares dipped 27 percent last year. The company’s stocks have regained around half their lost value so far in 2023. While chipmakers globally are bracing for dampened demand, TSMC is more shielded from a downturn in part because it produces some of the most advanced and smallest chips, which are still highly sought after and in short supply. It controls more than half of global foundry output, with clients including Apple and Qualcomm. Last year TSMC announced it had started mass production of its 3-nanometre chips, among the most advanced to come to market.