1934 Act Registration No. 1-14700

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934

For the month of January 2005

Taiwan Semiconductor Manufacturing Company Ltd.

(Translation of Registrant’s Name Into English)

No. 8, Li-Hsin Rd. 6,
Science-Based Industrial Park,
Hsin-Chu, Taiwan
(Address of Principal Executive Offices)

     (Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F þ                    Form 40-F o

     (Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

Yes o                    No þ

(If “Yes” is marked, indicated below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82: __________.)

FOR IMMEDIATE RELEASE

CONTACT IN TAIWAN
Elizabeth Sun/Julie Chan/Eric Chiang
Investor Relations Division
TSMC
invest@tsmc.com
886-3-568-2085/2080/2087

Topics in This Report

•   Revenue Analysis

•   Utilization & Capacity

•   Profit & Expense Analysis

•   Financial Condition Review

•   Cash Flow & CapEx

•   Recap of Recent Important Events & Announcements

4Q04 Quarterly Management Report
January 27, 2005

Operating Results Review:

Summary:
(Amount in NT$ billion except noted otherwise)	4Q04			3Q04			4Q03			QoQ			YoY
EPS (NT$  per com. shr.)		0.96			1.20			0.68			-20.5	%		40.1	%
(US$  per ADR unit)		0.15			0.18			0.10
Net Sales		63.87			69.74			57.78			-8.4	%		10.5	%
Gross Profit		27.15			32.14			22.71			-15.5	%		19.6	%
Operating Expense		(6.12	)		(6.02	)		(6.08	)		1.8	%		0.7	%
Non-Operating Items		1.07			2.01			0.94			-46.9	%		13.0	%
Net Income		22.18			27.93			16.00			-20.6	%		38.6	%
Wafers Shipped (kpcs 8 inch-equiv.)		1,220			1,333			1,127			-8.5	%		8.3	%
Capacity Utilization		88	%		103	%		101	%		-14.7	%		-12.6	%
Net Profit Margin		34.7	%		40.1	%		27.7	%

Remarks:

The fourth quarter EPS of NT$0.96 represents a 20.5% decrease compared with 3Q04. The unconsolidated operating results of 4Q04 are summarized below:

Net sales declined 8.4% to NT$63.9 billion compared with NT$69.7 billion in the third quarter. The decrease in fourth quarter revenue mainly reflected an 8.5% decrease in wafer shipments and a 2.9% depreciation of the US dollar against local currency, ameliorated by a 1.7% increase in wafer average selling price (ASP).

Gross profit decreased to NT$27.2 billion, representing a 15.5% decline from the previous quarter. Gross margin reduced to 42.5% from 46.1% in 3Q04 due mainly to lower levels of wafer output, an unfavorable exchange rate, and the ramp-up of Fab 14, a new 12-inch wafer fab.

Operating expenses increased slightly to NT$6.1 billion from the previous quarter’s NT$6.0 billion. The increase is the result of 14.3% higher R&D expenses netted by an 11.7% decline of SG&A expenses.

Combined non-operating income and long-term investment gains of NT$1.1 billion was 46.9% lower than in the previous quarter. The reduction was mainly the result of less profitable operating performance by TSMC subsidiary/affiliates and lower gains from other non-operating items.

Income before tax declined 21.5% sequentially to NT$22.1 billion. The Company’s provision for tax expenses of NT$2.6 billion was more than offset by an investment tax credit of NT$2.7 billion. TSMC’s 4Q04 net income was NT$22.2 billion with a net margin of 34.7%.

TSMC
January 27, 2005 Page 2

I. Revenue Analysis

I — 1. Wafer Sales Analysis

By Application	4Q04			3Q04			4Q03
Computer		35	%		31	%		35	%
Communication		41	%		42	%		42	%
Consumer		16	%		20	%		17	%
Industrial/Others		6	%		5	%		4	%
Memory		2	%		2	%		2	%

By Technology	4Q04			3Q04			4Q03
0.13um-		36	%		30	%		18	%
0.15/0.18um		34	%		38	%		45	%
0.25um		14	%		14	%		20	%
0.35um+		9	%		10	%		10	%
0.50um+		7	%		8	%		7	%

By Customer Type	4Q04			3Q04			4Q03
Fabless		66	%		69	%		71	%
IDM		33	%		31	%		29	%
System		1	%		0	%		0	%

By Geography	4Q04			3Q04			4Q03
North America		75	%		75	%		75	%
Asia Pacific		10	%		11	%		12	%
Europe		7	%		7	%		5	%
Japan		8	%		7	%		8	%

Revenue Analysis:

Net sales decreased 8.4% to NT$63.9 billion compared with NT$69.7 billion in the third quarter. The decrease in fourth quarter revenue mainly resulted from an 8.5% decrease in wafer shipments and a 2.9% depreciation of the US dollar against local currency, ameliorated by a 1.7% increase in wafer average selling price (ASP).

Revenues from computer applications continued to grow in this quarter while revenues from both communication applications and consumer applications declined.

Demand from advanced technologies — defined as 0.13-micron and below — strengthened further in 4Q04 with 90nm commencing volume production with very high yield and good quality. Revenue contribution from advanced technology wafers increased to 36% of total wafer sales, compared to 30% in the previous quarter.

IDM wafer sales weighting during the quarter rose to 33% from 31% in the previous quarter while Fabless accounted for 66%. The increase in IDM weighting was mainly attributable to continuous IDM outsourcing in advanced technology.

Geographically, the distribution remained similar to the previous quarter.

ASP Trend:

Continuing from 3Q04’s 1.4% increase, ASP rose again by 1.7% in this quarter. This quarter’s ASP increase was attributable to a better product mix.

TSMC
January 27, 2005 Page 3

II. Utilization & Capacity

Utilization Rate:

Overall capacity utilization decreased to 88% in this quarter from 103% in the third quarter.

II — 2. Capacity

	4Q04		2004		1Q05
Fab / (Wafer size)	(Act.)		(Act.)		(Est.)
Fab-2 (6")1		248		930		238
Fab-3 (8")		247		922		234
Fab-5 (8")		124		470		119
Fab-6 (8")		217		813		203
Fab-7 (8")		40		165		36
Fab-8 (8")		224		823		215
Fab-12 (12")2		80		244		85
Fab-14 (12")2		6		6		18
TSMC — owned capacity 8"-equivalent Kpcs		1,184		4,279		1,172
Wafer Tech (8")		97		373		95
SSMC (8")		39		136		41
TSMC (Shanghai) (8")		1		1		9
Total TSMC — managed 8"-equivalent Kpcs		1,320		4,788		1,317

	Note: 1. Figues represent number of 6" wafers. Conversion to 8"-equivalent wafers is by dividing this number by 1.78
2.	Figues represent number of 12" wafers. Conversion to 8"-equivalent wafers is by multiplying this number by 2.25

Capacity:

Total TSMC managed capacity in 4Q04 was 1,320 kpcs/quarter in terms of 8-inch equivalent wafers, representing 4.8% sequential capacity growth, where 12-inch wafer capacity increased 24.6% sequentially.

Overall installed capacity for year 2004 was about 4.8 million 8-inch equivalent wafers.

While the majority of TSMC fabs will conduct annual maintenance in 1Q05, TSMC managed capacity is expected to remain about the same at 1,317 kpcs 8-inch equivalent wafers.

Overall installed capacity for year 2005 is expected to reach 5.95 million 8-inch equivalent wafers, representing 24% year-on-year growth. Capacity for 90 nanometers, which are produced only from 12-inch wafers, will increase 18 times, and the overall 12-inch wafer capacity will more than double.

TSMC
January 27, 2005 Page 4

III. Profit & Expense Analysis

III — 1. Gross Profit Analysis

(Amount: NT$ billion)	4Q04			3Q04			4Q03
COGS		36.7			37.6			35.1
Depreciation		14.9			13.7			13.9
Other MFG Cost		21.8			23.9			21.2
Gross Profit		27.2			32.1			22.7
Gross Margin
- TSMC		42.5	%		46.1	%		39.3	%
- TSMC w/o affiliates		47.8	%		51.9	%		44.2	%

Gross Profit Analysis:

Gross profit decreased to NT$27.2 billion, representing a 15.5% decline from the previous quarter. Gross margin reduced to 42.5% from 46.1% in 3Q04 mainly due to lower levels of wafer output, an unfavorable exchange rate, and the ramp-up of Fab 14.

During the quarter, the gross margin from TSMC’s own fab manufacturing activities declined to 47.8% from 51.9% in 3Q04.

III — 2. Operating Expense Analysis

(Amount: NT$ billion)	4Q04		3Q04		4Q03
Total Operating Exp.		6.12		6.02		6.08
SG&A		2.56		2.90		2.03
Research & Development		3.57		3.12		4.06

Operating Expenses:

Operating expenses increased slightly to NT$6.1 billion. R&D expenditures were sequentially higher due mainly to further development efforts related to 65-nm process technology and more engineering wafers to support the Fab14 ramp-up. SG&A expenditures were sequentially lower mainly because Fab14 stopped incurring opening expenses as it commenced commercial production during 4Q04. Overall, operating expenses represented 9.6% of net sales, compared to last quarter’s 8.6%.

III — 3. Non-Operating Items

(Amount: NT$ million)	4Q04			3Q04			4Q03
Non-Operating Income/(Exp.)		457			630			(193	)
Net Interest Income/(Exp.)		227			228			(14	)
Other Non-Operating		230			402			(178	)
L-T Investments		609			1,378			1,135
WaferTech*		891			1,643			549
SSMC		31			268			131
Vanguard		423			326			99
TSMC (Shanghai)		(359	)		(237	)		(1	)
Miscellaneous		(377	)		(622	)		357
Total Non-Operating Items		1,066			2,008			942

*   Operation results only; does not include amortization of impaired assets.

Non-Operating Items:

Combined non-operating income and long-term investment gains decreased 46.9% to NT$1.1 billion from NT$2.0 billion in the previous quarter.

During the quarter, non-operating income amounted to NT$457 million, NT$173 million lower than last quarter’s income of NT$630 million. This decrease was due mainly to lower royalty income accrued and the revaluation losses of short-term investments in marketable securities, offset partially by higher foreign exchange gains from hedging activities.

Long-term investment gains declined to NT$609 million, compared to NT$1,378 million in 3Q04. The decrease mainly resulted from lower utilization levels at WaferTech and SSMC, and higher expenses incurred at TSMC (Shanghai). These were offset partially by the continuous improvement in Vanguard and smaller losses in miscellaneous others.

TSMC
January 27, 2005 Page 5

IV. Financial Condition Review

IV — 1. Liquidity Analysis

(Amount: NT$ billion)	4Q04		3Q04		4Q03
Cash & S-T Investments		118.5		124.4		110.8
Accounts Receivable — Trade		27.2		33.4		25.6
Inventory		14.2		12.6		10.9
Deferred Income Tax Assets		8.8		2.5		8.3
Total Current Assets		173.7		177.7		158.5
Accounts Payable		40.8		28.3		17.7
Current Portion of Bonds Payable		10.5		5.0		5.0
Accrued Liabilities and Others		9.3		11.0		7.8
Total Current Liabilities		60.6		44.2		30.5
Current Ratio (x)		2.9		4.0		5.2
Net Working Capital		113.0		133.4		128.0

Liquidity Analysis:

Total current assets were NT$4.0 billion lower on a sequential basis. The decrease was mainly attributable to lower cash & short-term investment and accounts receivable, partially offset by higher inventory and deferred income tax assets. The NT$5.9 billion decrease in cash and short-term investment was due mainly to a long-term investment of NT$5.6 billion in a structured note during this quarter, and a reclassification of NT$4.9 billion of such notes from short-term to long-term investment made in the previous quarter.

Meanwhile, total current liabilities increased significantly due mainly to the increase of accounts payable resulting from the faster move-in of 12-inch production equipment in this quarter and the increase of the current portion of bonds payable.

As a result, the Company’s current ratio declined to 2.9x and net working capital reduced to NT$113.0 billion, a decrease of NT$20.4 billion over the previous quarter.

Receivable/Inventory Days Trend:

Days of receivables increased to 45 days compared with 43 days in 3Q04, reflecting slower business activities during 4Q04.

Days of Inventory increased to 41 days as compared to 38 days in the previous quarter. The increase was due mainly to the combination of higher values of WIP for increased 12-inch production and higher finished goods.

IV — 3. Debt Service

(Amount: NT$ billion)	4Q04		3Q04		4Q03
Cash & S-T Investments		118.5		124.4		110.8
Interest-Bearing Debt		30.0		35.0		35.0
Net Cash Reserves		88.5		89.4		75.8

Debt Service:

Net cash reserves, defined as the excess of cash and short-term investments over interest-bearing debt, decreased by NT$0.9 billion to NT$88.5 billion in 4Q04.

Interest-bearing debt reduced to NT$30 billion as NT$5 billion bonds were redeemed in this quarter.

TSMC
January 27, 2005 Page 6

V. Cash Flow & CapEx

V — 1. Cash Flow Analysis

(Amount: NT$ billion)	4Q04			3Q04			4Q03
Net Income		22.2			27.9			16.0
Depreciation & Amortization		16.6			15.4			15.5
Other Op Sources/(Uses)		(2.1	)		(5.1	)		(0.0	)
Total Op Sources/(Uses)		36.7			38.2			31.5
Capital Expenditure		(20.5	)		(16.5	)		(12.8	)
Short Term Investment		(6.9	)		(4.9	)		(0.9	)
Long Term Investment		(17.0	)		(7.3	)		(2.0	)
Other Investing Sources/(Uses)		(0.0	)		(0.4	)		(0.2	)
Net Investing Sources/(Uses)		(44.4	)		(29.1	)		(15.9	)
Cash dividends paid to common stocks		0.0			(12.2	)		0.0
Bonus paid to Employees		0.0			(0.7	)		0.0
Payment on long-term bonds payable		(5.0	)		0.0			0.0
Other Financing Sources/(Uses)		(0.1	)		(0.1	)		(0.1	)
Net Financing Sources/(Uses)		(5.1	)		(12.9	)		(0.1	)
Net Cash Position Changes		(12.8	)		(3.9	)		15.6
Cash Balance		65.5			78.3			98.3

Summary of Cash Flow:

During the quarter, TSMC generated NT$36.7 billion operating cash inflow mainly from net income of NT$22.2 billion and depreciation & amortization of NT$16.6 billion. This was partially offset by increases in working capital.

Net cash used in investing activities totaled NT$44.4 billion including (i) capital spending of NT$20.5 billion, (ii) a continued accumulation of NT$6.9 billion in short-term investments, and (iii) long-term investments of NT$3.5 billion in government and corporate bonds, NT$2.9 billion capital injection to TSMC (Shanghai), and NT$5.6 billion in a structured note and a NT$4.9 billion reclassification of such notes.

A net cash outflow of NT$5.1 billion in financing activities was largely attributable to the Company’s NT$5.0 billion bond redemption.

As a result, TSMC ended the quarter with a cash balance of NT$65.5 billion.

Operating Cash Flow Trend:

Operating cash flow of NT$36.7 billion was slightly lower than the previous quarter due mainly to lower net income.

CapEx
(in US$ million)	1Q04		2Q04		3Q04		4Q04		2004
TSMC		489		683		484		621		2,277
WaferTech		14		27		26		5		72
TSMC (Shanghai)		1		9		8		51		69
Total		504		719		518		677		2,418

Capital Spending:

Capital expenditures for TSMC alone during the quarter totaled US$621 million. Most of the spending was for 12-inch capacity ramp-up in Fab 12 and Fab 14.

Capital spending for WaferTech was US$5 million, and US$51 million for TSMC (Shanghai).

For Year 2004, total capital expenditures for TSMC as a group amounted to US$2.4 billion, including US$2.3 billion for TSMC, US$72 million for WaferTech, and US$69 million for TSMC (Shanghai).

TSMC
January 27, 2005 Page 7

VI. Recap of Recent Important Events & Announcements

•   TSMC Verifies Fully Functional 90 Nanometer Chips Using Immersion Lithography Tools (2004/12/22 )

•   TSMC Holds A Special Shareholders’ Meeting To Approve Amendment of Dividend Policy (2004/12/21 )

•   TSMC 0.18-Micron High-Voltage Technology Goes to Volume Production (2004/11/23)

•   TSMC Is Awarded Best IR by A Taiwan Company by IR Magazine (2004/11/04)

•   TSMC Board of Directors Proposes Amendment of Dividend Policy (2004/11/02)

•   TSMC Aims to be Best Partner in “Invented/Made in China” Arena (2004/10/28)

•   Freescale and TSMC to Develop Silicon-on-Insulator Technology (2004/10/12)

Please visit TSMC’s Web site (http://www.tsmc.com) for details about these and other announcements.

TAIWAN SEMICONDUCTOR MANUFACTURING CO., LTD.
Unconsolidated Balance Sheet

As of December 31, 2004 and 2003
(Figures in Million of New Taiwan Dollars (NTD) and U.S. Dollars (USD)) ⁽¹⁾

	December 31, 2004									December 31, 2003						YoY
ASSETS	USD			NTD			%			NTD			%			Move			Inc.(Dec.)%
Cash		2,053			65,532			13.4			98,288			24.8			(32,756	)		(33.3	)
Short Term Investment		1,660			52,979			10.9			12,559			3.2			40,420			321.8
Accounts Receivable — Trade		852			27,205			5.6			25,643			6.5			1,562			6.1
Inventories		444			14,172			2.9			10,907			2.8			3,265			29.9
Other Current Assets		432			13,779			2.8			11,129			2.7			2,650			23.8
Total Current Assets		5,441			173,667			35.6			158,526			40.0			15,141			9.6
Long Term Investment		2,297			73,293			15.0			37,965			9.6			35,328			93.1
Fixed Assets		16,543			527,982			108.4			435,801			109.9			92,181			21.2
Less Accumulated Depreciation		(9,400	)		(300,006	)		(61.6	)		(247,514	)		(62.4	)		(52,492	)		21.2
Net Fixed Assets		7,143			227,976			46.8			188,287			47.5			39,689			21.1
Other Assets		395			12,617			2.6			11,639			2.9			978			8.4
Total Assets		15,276			487,553			100.0			396,417			100			91,136			23.0
LIABILITIES
Accounts Payable		304			9,687			2.0			10,584			2.7			(897	)		(8.5	)
Payables to Contractors and Equipment Suppliers		976			31,154			6.4			7,118			1.8			24,036			337.7
Accrued Expenses and Other Current Liabilities		291			9,298			1.9			7,836			1.9			1,462			18.7
Current Portion of Bonds Payable		329			10,500			2.2			5,000			1.3			5,500			31.9
Total Current Liabilities		1,900			60,639			12.5			30,538			7.7			30,101			98.6
Bonds Payable		611			19,500			4.0			30,000			7.6			(10,500	)		(35.0	)
Other Long Term Liabilities		265			8,449			1.7			6,665			1.7			1,784			26.8
Total Liabilities		2,776			88,588			18.2			67,203			17.0			21,385			31.8
SHAREHOLDERS’ EQUITY
Capital Stock		7,285			232,520			47.7			202,666			51.1			29,854			14.7
Capital Surplus		1,771			56,537			11.6			56,856			14.3			(319	)		(0.6	)
Legal Reserve		800			25,528			5.2			20,802			5.2			4,726			22.7
Special Reserve		—			—			—			69			0.0			(69	)		—
Retained Earnings		2,763			88,202			18.1			50,229			12.7			37,973			75.6
Treasury Stock		(50	)		(1,595	)		(0.3	)		(1,633	)		(0.4	)		38			(2.3	)
Unrealized Loss on Long-term Investments		—			—			—			(0	)		(0.0	)		0			—
Cumulated Translation Adjustment		(69	)		(2,227	)		(0.5	)		225			0.1			(2,452	)		—
Total Equity		12,500			398,965			81.8			329,214			83.0			69,751			21.2
Total Liabilities & Shareholders’ Equity		15,276			487,553			100.0			396,417			100			91,136			23.0

Note: (1)  New Taiwan dollar amounts have been translated into U.S. dollars at the rate of NT$31.92 per U.S. dollar as of December 31, 2004

TAIWAN SEMICONDUCTOR MANUFACTURING CO., LTD.
Unconsolidated Balance Sheet

As of December 31 and September 30, 2004
(Figures in Million of New Taiwan Dollars (NTD) and U.S. Dollars (USD))(1)

	December 31, 2004									September 30, 2004						QoQ
ASSETS	USD			NTD			%			NTD			%			Move			Inc.(Dec.)%
Cash		2,053			65,532			13.4			78,290			16.9			(12,758	)		(16.3	)
Short Term Investment		1,660			52,979			10.9			46,128			10.0			6,851			14.9
Accounts Receivable — Trade		852			27,205			5.6			33,415			7.2			(6,210	)		(18.6	)
Inventories		444			14,172			2.9			12,629			2.7			1,544			12.2
Other Current Assets		432			13,779			2.8			7,220			1.6			6,558			90.8
Total Current Assets		5,441			173,667			35.6			177,682			38.4			(4,015	)		(2.3	)
Long Term Investment		2,297			73,293			15.0			58,186			12.6			15,107			26.0
Fixed Assets		16,543			527,982			108.4			492,964			106.6			35,018			7.1
Less Accumulated Depreciation		(9,400	)		(300,006	)		(61.6	)		(285,808	)		(61.8	)		(14,198	)		5.0
Net Fixed Assets		7,143			227,976			46.8			207,156			44.8			20,820			10.1
Other Assets		395			12,617			2.6			19,484			4.2			(6,867	)		(35.2	)
Total Assets		15,276			487,553			100.0			462,508			100.0			25,045			5.4
LIABILITIES
Accounts Payable		304			9,687			2.0			12,997			2.8			(3,310	)		(25.5	)
Payables to Contractors and Equipment Suppliers		976			31,154			6.4			15,261			3.3			15,893			104.1
Accrued Expenses and Other Current Liabilities		291			9,298			1.9			10,974			2.4			(1,676	)		(15.3	)
Current Portion of Bonds Payable		329			10,500			2.2			5,000			1.1			5,500			110.0
Total Current Liabilities		1,900			60,639			12.5			44,232			9.6			16,407			37.1
Bonds Payable		611			19,500			4.0			30,000			6.5			(10,500	)		(35.0	)
Other Long Term Liabilities		265			8,449			1.7			9,013			1.9			(564	)		(6.3	)
Total Liabilities		2,776			88,588			18.2			83,245			18.0			5,343			6.4
SHAREHOLDERS’ EQUITY
Capital Stock		7,285			232,520			47.7			232,519			50.2			1			0.0
Capital Surplus		1,771			56,537			11.6			56,529			12.2			8			0.0
Legal Reserve		800			25,528			5.2			25,528			5.5			—			0.0
Special Reserve		—			—			—			—			—			—			—
Retained Earnings		2,763			88,202			18.1			66,007			14.3			22,195			33.6
Treasury Stock		(50	)		(1,595	)		(0.3	)		(1,617	)		(0.3	)		22			(1.4	)
Unrealized Loss on Long-term Investments		—			—			—			(3	)		(0.0	)		3			—
Cumulated Translation Adjustment		(69	)		(2,227	)		(0.5	)		300			0.1			(2,528	)		—
Total Equity		12,500			398,965			81.8			379,263			82.0			19,702			5.2
Total Liabilities & Shareholders’ Equity		15,276			487,553			100.0			462,508			100.0			25,045			5.4

Note: (1)    New Taiwan dollar amounts have been translated into U.S. dollars at the rate of NT$31.92 per U.S. dollar as of December 31, 2004

TAIWAN SEMICONDUCTOR MANUFACTURING CO., LTD.
UNCONSOLIDATED INCOME STATEMENT

For the Three Months Ended December 31, 2004, December 31, 2003 and September 30, 2004
(Expressed in Million New Taiwan Dollars (NTD) and U.S. Dollars (USD) ⁽¹⁾
Except for Per Share Amounts and Shares Outstanding)

	Year over Year Comparison															Sequential Comparison
	Q4 2004						% of			Q4 2003			YoY			Q4 2004						% of			Q3 2004			QoQ
	USD			NTD			Sales			NTD			Inc.(Dec.) %			USD			NTD			Sales			NTD			Inc.(Dec.) %
Net Sales		1,936			63,875			100.0			57,780			10.5			1,936			63,875			100.0			69,735			(8.4	)
Cost of Sales		(1,113	)		(36,722	)		(57.5	)		(35,073	)		4.7			(1,113	)		(36,722	)		(57.5	)		(37,595	)		(2.3	)
Gross Profit		823			27,153			42.5			22,707			19.6			823			27,153			42.5			32,140			(15.5	)
Operating Expenses
Research and Development Expenses		(108	)		(3,568	)		(5.6	)		(4,055	)		(12.0	)		(108	)		(3,568	)		(5.6	)		(3,123	)		14.3
General and Administrative Expenses		(65	)		(2,153	)		(3.4	)		(1,765	)		21.9			(65	)		(2,153	)		(3.4	)		(2,578	)		(16.5	)
Selling and Marketing Expenses		(13	)		(404	)		(0.6	)		(262	)		54.4			(13	)		(404	)		(0.6	)		(318	)		27.1
Total Operating Expenses		(186	)		(6,125	)		(9.6	)		(6,082	)		0.7			(186	)		(6,125	)		(9.6	)		(6,019	)		1.8
Income from Operations		637			21,028			32.9			16,625			26.5			637			21,028			32.9			26,121			(19.5	)
Net Non-operating Income (Expenses)		15			457			0.7			(192	)		—			15			457			0.7			630			(27.4	)
Investment Gain (Loss)		18			609			1.0			1,135			(46.4	)		18			609			1.0			1,378			(55.8	)
Income before Income Tax		670			22,094			34.6			17,568			25.8			670			22,094			34.6			28,129			(21.5	)
Income Tax Credit (Expenses)		2			90			0.1			(1,566	)		—			2			90			0.1			(196	)		—
Net Income		672			22,184			34.7			16,002			38.6			672			22,184			34.7			27,933			(20.6	)
Diluted Earnings Per Ordinary Share		0.03			0.96						0.68			40.1			0.03			0.96						1.20			(20.5	)
Earnings Per ADR (2)		0.15			4.77						3.40						0.15			4.77						3.72
Weighted Average Outstanding Shares (‘M) (3)					23,255						23,337									23,255						23,270

Note: (1)	New Taiwan dollars have been translated into U.S. dollars at the weighted average rate of NTD32.99 per U.S. dollar for the fourth quarter of 2004.
(2)	1 ADR equals 5 ordinary shares.
(3)	Total weighted average outstanding shares for 4Q ‘03 has been retroactively adjusted for stock dividends and stock bonus.

TAIWAN SEMICONDUCTOR MANUFACTURING CO., LTD.
UNCONSOLIDATED INCOME STATEMENT

For the Twelve Months Ended December 31, 2004 and 2003
(Expressed in Million New Taiwan Dollars (NTD) and U.S. Dollars (USD) ⁽¹⁾
Except for Per Share Amounts and Shares Outstanding)

	2004						% of			2003			YoY
	USD			NTD			Sales			NTD			Inc.(Dec.) %
Net Sales		7,653			255,992			100.0			201,904			26.8
Cost of Sales		(4,360	)		(145,831	)		(57.0	)		(129,012	)		13.0
Gross Profit		3,294			110,161			43.0			72,892			51.1
Operating Expenses
Research and Development Expenses		(374	)		(12,516	)		(4.9	)		(12,713	)		(1.5	)
General and Administrative Expenses		(280	)		(9,367	)		(3.7	)		(6,338	)		47.8
Selling and Marketing Expenses		(43	)		(1,455	)		(0.6	)		(1,193	)		21.9
Total Operating Expenses		(698	)		(23,338	)		(9.1	)		(20,244	)		15.3
Income from Operations		2,596			86,823			33.9			52,648			64.9
Net Non-operating Expenses		27			916			0.4			(2,411	)		—
Investment Loss		121			4,040			1.6			791			410.5
Income before Income Tax		2,744			91,779			35.9			51,028			79.9
Income Tax Credit (Expenses)		16			537			0.2			(3,769	)		—
Net Income		2,760			92,316			36.1			47,259			95.3
Diluted Earnings Per Ordinary Share (2)		0.12			3.97						2.02			96.8
Earnings Per ADR (3)		0.59			19.85						10.09
Weighted Average Outstanding Shares (’M) (4)					23,255						23,337

Note: (1)	New Taiwan dollars have been translated into U.S. dollars at the weighted average rate of NTD 33.45 per U.S. dollar for the twelve months of 2004.
(2)	EPS calculation for 2003 is after deducting a cash dividend payment on NT$13,000 million of preferred stock paying an annual rate of 3.5% at the period from January 1 to May 29, 2003. The preferred stock was redeemed on May 29, 2003.
(3)	1 ADR equals 5 ordinary shares.
(4)	Total weighted average outstanding shares were 23,255M shares for the twelve months ended December 31, 2004 and 23,337M shares for the twelve months ended December 31, 2003 after the retroactive adjustments for stock dividends and stock bonus.

TAIWAN SEMICONDUCTOR MANUFACTURING CO., LTD.
UNCONSOLIDATED STATEMENT OF CASH FLOWS

For the Twelve Months Ended December 31, 2004
(Figures in Million of New Taiwan Dollars (NTD) and U.S. Dollars (USD)) ⁽¹⁾

	12 Months 2004						4Q 2004			3Q 2004			4Q 2003
	USD			NTD			NTD			NTD			NTD
Cash Flows from Operating Activities:
Net Income		2,760			92,316			22,184			27,933			16,002
Depreciation & Amortization		1,886			63,072			16,615			15,371			15,495
Deferred Income Tax		(33	)		(1,101	)		(226	)		46			1,566
Investment Loss (Gain) Recognized by Equity Method		(121	)		(4,040	)		(608	)		(1,378	)		(1,135	)
Gain on Sale of Long-Term Investments		—			(2	)		—			0			(13	)
Changes in Working Capital & Others		(196	)		(6,565	)		(1,231	)		(3,813	)		(432	)
Net Cash Provided from Operating Activities		4,296			143,680			36,734			38,159			31,483
Cash Flows from Investing Activities:
Increase in Short-Term Investments		(1,310	)		(43,823	)		(6,851	)		(4,929	)		(865	)
Increase in Long-Term Investments		(906	)		(30,291	)		(17,009	)		(7,339	)		(1,955	)
Acquisition of Fixed Assets		(2,277	)		(76,171	)		(20,521	)		(16,471	)		(12,832	)
Proceeds from Sales of Long-Term Investments		—			8			—			0			18
Proceeds from Disposal of Properties		51			1,714			1,404			60			18
Increase in Deferred Assets		(72	)		(2,404	)		(1,351	)		(412	)		(345	)
Decrease (Increase) in Deposit-Out		3			92			(56	)		(3	)		110
Net Cash Used in Investing Activities		(4,511	)		(150,875	)		(44,384	)		(29,094	)		(15,851	)
Cash Flows from Financing Activities:
Cash Dividend — Common Shares		(364	)		(12,160	)		—			(12,160	)		—
Increase in Treasury Stocks		(211	)		(7,060	)		—			—			—
Repayment of corporate bonds		(149	)		(5,000	)		(5,000	)		—			—
Bonus Paid to Employees		(20	)		(682	)		—			(682	)		—
Cash Dividend — Preferred Shares		(6	)		(184	)		—			—			—
Decrease in Guarantee Deposits & Others		(10	)		(351	)		(112	)		(75	)		(75	)
Bonus Paid to Directors and Supervisors		(4	)		(128	)		—			—			—
Issuance of stocks option					4			4			—			—
Net Cash Used in Financing Activities		(764	)		(25,561	)		(5,108	)		(12,917	)		(75	)
Net Increase (Decrease) in Cash and Cash Equivalents		(979	)		(32,756	)		(12,758	)		(3,852	)		15,557
Cash and Cash Equivalents at Beginning of Period		2,939			98,288			78,290			82,142			82,731
Cash and Cash Equivalents at End of Period		1,960			65,532			65,532			78,290			98,288

Note: (1)     New Taiwan dollar amounts have been translated into U.S. dollars at the rate of NTD33.45 per U.S. dollar, the weighted average exchange rate for the twelve months of 2004.

TSMC 2004 Fourth Quarter Results Investor Conference January 27th, 2005

Agenda Welcome 2004 4Q Financial Results Lora Ho (unconsolidated) Remarks Morris Chang Q&A

Safe Harbor Notice TSMC's statements of its current expectations are forward- looking statements subject to significant risks and uncertainties and actual results may differ materially from those contained in the forward-looking statements. Information as to those factors that could cause actual results to vary can be found in TSMC's Annual Report on Form 20-F filed with the United States Securities and Exchange Commission (the "SEC") on May 28, 2004, and such other documents as TSMC may file with, or submit to, the SEC from time to time. Except as required by law, we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

* Annualized ROE for the quarter. 4Q'04 Result Highlights

Income Statement - QoQ Comparison

Income Statement - YoY Comparison

2004 Income Statement

Balance Sheet & Key Indices

Cash Flows

Capital Expenditures

Sales Breakdown by Technology

Sales Breakdown by Application

Note: This chart does not reflect the actual shipment destination of sales. Sales Breakdown by Geography

Sales Breakdown by Customer

Fab Utilization and ASP Trend

Note: 1 Figures represent number of 6" wafers. Conversion to 8"-equivalent wafers is by dividing this number by 1.78. 2 Figures represent number of 12" wafers. Conversion to 8"-equivalent wafers is by multiplying this number by 2.25. Installed Capacity by Fab

Recap of Recent Major Events TSMC Verifies Fully Functional 90 Nanometer Chips Using Immersion Lithography Tools ( 2004/12/22 ) TSMC Holds A Special Shareholders' Meeting To Approve Amendment of Dividend Policy ( 2004/12/21 ) TSMC 0.18-Micron High-Voltage Technology Goes to Volume Production ( 2004/11/23 ) TSMC Is Awarded Best IR by A Taiwan Company by IR Magazine ( 2004/11/04) TSMC Board of Directors Proposes Amendment of Dividend Policy ( 2004/11/02) TSMC Aims to be Best Partner in "Invented/Made in China" Arena ( 2004/10/28 ) Freescale and TSMC to Develop Silicon-on-Insulator Technology ( 2004/10/12 ) Please visit TSMC's Web site (http://www.tsmc.com) for details and other announcements.

1Q'05 Guidance Wafer shipments to decrease by a single digit percentage point sequentially; Overall utilization rate to be about 78%; Gross profit margin to be in the range of 38% to 40%; ASP to remain at about the same level sequentially; 2005 CapEx to be in the range of US$2.5 - 2.7 billion.

http://www.tsmc.com invest@tsmc.com

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Taiwan Semiconductor Manufacturing Company Ltd.
Date: January 27, 2005	By /s/ Lora Ho
	Lora Ho
	Vice President & Chief Financial Officer