* Sees FY revenue up 11-12 pct; prev saw 5-10 pct growth
* Q3 net profit up 28 pct to T$96.8 bln, new quarterly high
* Q3 revenue up 23 pct to T$260.4 bln, new quarterly record
* Analysts expect iPhone 7 launch boosted TSMC chip sales
* 'Demand for high-end smartphones still rising' - co-CEO (Adds executive comment on Samsung smartphone woes)
By J.R. Wu
TAIPEI, Oct 13 (Reuters) - Taiwan Semiconductor Manufacturing Co (TSMC) raised its forecast for 2016 revenue after setting new profit and sales records in the third quarter, as analysts said it was riding high on supplying parts for Apple Inc's new iPhone 7.
The world's largest contract chipmaker's bullish forecast comes as anticipation has intensified about how the iPhone 7, launched in early September, has been selling in the wake of Samsung Electronics Co scrapping its Galaxy Note 7 smartphone in what could be one of the costliest product safety failures in tech history.
TSMC, which doesn't disclose details of customer orders, said on Thursday it now expects revenue growth to be 11-12 percent, compared with a previous estimate of a 5-10 percent increase. "Demand for high-end smartphones will continue to improve," said co-Chief Executive Officer Mark Liu, speaking at an earnings conference.
The upped guidance came after TSMC reported July-September net profit climbed 28 percent to T$96.8 billion ($3.08 billion). That beat both the T$95.2 billion mean forecast in a Thomson Reuters/Eikon survey of analysts' forecasts and the previous quarterly record of T$80 billion.
Asked to comment on the potential industry impact of Samsung's woes, TSMC officials said it was too early to tell how business will play out. Guidance for the rest of the year didn't factor in any projections on the scrapping of the iPhone rival smartphone, they said.
"Samsung is a very strong company," TSMC acting spokeswoman Elizabeth Sun, told reporters at a briefing after the company met analysts. "I think the issue today is that even they (Samsung) cannot say what has caused this, so this makes everyone nervous."
TSMC's third-quarter revenue rose 23 percent to T$260.4 billion, another quarterly record and also ahead of guidance the firm offered in July. Last week TSMC said revenue for the first nine months of the year rose 7.1 percent to T$685.71 billion, jumping 39 percent in September, alone.
According to Taiwan-based Fubon Research, TSMC is the sole source for the A10 processor used in the iPhone 7 and also the main foundry source for chips in the smartphone.
Based on an estimated shipment of 82 million units of iPhone 7s in the second half of this year, Fubon expects the iPhone 7 business to likely account for at least 10 percent to 15 percent of TSMC's revenue in the second half of 2016.
For the fourth quarter, TSMC said it expects revenue to be between T$255 billion and T$258 billion, just below the new record set in the July-September period.
"The previously anticipated inventory reduction at the end of Q4 will be mild," co-CEO Liu said during the earnings briefing. "The end of this year will be more peaceful than in previous years. We see end-market demand is still healthy." ($1 = 31.4450 Taiwan dollars)
Reporting by J.R. Wu; Editing by Kenneth Maxwell