Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest contract chip manufacturer and a key supplier of iPhone processor chips, cut its Q3 revenue target by 3 per cent after a virus affecting a number of computer systems and fab tools in Taiwan caused shipping delays and raised costs.

The company said in a statement it contained the outbreak, fixing about 80 per cent of the facilities impacted, and expects a full recovery by today (6 August).

It also said the incident would cut its gross margin by about 1 percentage point in the July-September quarter, adding “the company is confident shipments delayed in third quarter will be recovered in the fourth quarter 2018, and maintains its forecast of high single-digit revenue growth for 2018”.

TSMC’s previous Q3 revenue was forecast at between $8.45 billion and $8.55 billion, while its gross margin target was 48 per cent to 50 per cent.

The outbreak started on 3 August and the company noted the degree of infection varied by fab.

TSMC said the virus was caused by “misoperation during the software installation process for a new [production] tool, which caused a virus to spread once the tool was connected to the company’s computer network”.

The company said most of its customers were notified of the event and it is working closely with them on their wafer delivery schedule.

It reported a 9.1 per cent year-on-year increase in its Q2 net profit to TWD72.3 billion, on revenue of TWD233 billion, also up 9.1 per cent.

As the largest semiconductor foundry in the world, TSMC manufactures chips for Apple, Qualcomm, Broadcom, Nvidia, and NXP among others.