United Microelectronics (NYSE:UMC) Announces Earnings Results

Key Points

• United Microelectronics beat expectations with quarterly EPS of $0.20 versus consensus $0.12 and revenue of $1.91 billion, but Q1 net income (TWD 16.17 billion, ~+50% QoQ) was lifted by non‑operating income, signaling earnings quality caveats.
• Management gave upbeat Q2 guidance — wafer shipments up high single digits, ASPs up low single digits, and gross margin targeted around ~30% with utilization in the low‑80% range — while 22nm revenue reached a record (~14% of sales) and a 12nm collaboration with Intel progresses.
• Margin pressure is expected to persist as higher depreciation from the Singapore 12‑inch ramp and rising raw‑material, energy and logistics costs offset shipment gains, though the company maintains a strong balance sheet (equity ~TWD 406 billion, cash on hand >TWD 100 billion).

United Microelectronics (NYSE:UMC - Get Free Report) released its quarterly earnings results on Wednesday. The semiconductor company reported $0.20 EPS for the quarter, beating analysts' consensus estimates of $0.12 by $0.08, FiscalAI reports. The business had revenue of $1.91 billion during the quarter, compared to analyst estimates of $1.96 billion. United Microelectronics had a return on equity of 11.45% and a net margin of 17.60%.

Here are the key takeaways from United Microelectronics' conference call:

• Q1 results: consolidated revenue was TWD 61.04 billion with a 29.2% gross margin, while net income rose to TWD 16.17 billion (up ~50% QoQ) largely helped by non‑operating income, indicating some earnings quality caveats.
• Q2 guidance is upbeat: wafer shipments expected to rise by high single digits, ASP (USD) up low single digits, gross margin around ~30%, and utilization targeted in the low‑80% range.
• Technology momentum: 22nm revenue hit a record (~14% of sales) with >50 customers slated to complete tape‑outs this year, and strategic projects include the 12nm collaboration (Intel) and a Silicon Photonics PDK v1.0 targeted for 2027.
• Margin pressure persists as higher depreciation from the Singapore 12‑inch ramp plus rising raw materials, energy and logistics costs are expected to offset much of the benefit from higher shipments, keeping gross margins constrained.
• Balance sheet and capital discipline: total equity ~TWD 406 billion, cash on hand >TWD 100 billion, and management expects 2026 cash CapEx to remain around TWD 1.5 billion.

United Microelectronics Stock Up 8.2%

Shares of UMC stock traded up $0.96 during midday trading on Wednesday, reaching $12.62. 14,073,232 shares of the stock were exchanged, compared to its average volume of 10,769,912. United Microelectronics has a 1 year low of $6.56 and a 1 year high of $13.39. The company's 50 day moving average is $10.00 and its two-hundred day moving average is $8.97. The company has a current ratio of 2.34, a quick ratio of 1.91 and a debt-to-equity ratio of 0.12. The firm has a market cap of $31.69 billion, a PE ratio of 23.33, a price-to-earnings-growth ratio of 6.21 and a beta of 1.16.

Analyst Ratings Changes

A number of research firms have commented on UMC. BNP Paribas Exane raised United Microelectronics from an "underperform" rating to a "neutral" rating and set a $8.60 price target for the company in a research report on Tuesday, March 31st. JPMorgan Chase & Co. reaffirmed an "underweight" rating on shares of United Microelectronics in a research report on Thursday, January 29th. Two research analysts have rated the stock with a Hold rating and three have assigned a Sell rating to the stock. Based on data from MarketBeat.com, United Microelectronics currently has a consensus rating of "Strong Sell" and a consensus price target of $8.60.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently made changes to their positions in the company. Sivia Capital Partners LLC grew its holdings in shares of United Microelectronics by 25.8% during the 2nd quarter. Sivia Capital Partners LLC now owns 29,408 shares of the semiconductor company's stock worth $225,000 after acquiring an additional 6,028 shares during the period. Engineers Gate Manager LP grew its holdings in shares of United Microelectronics by 13.9% during the 4th quarter. Engineers Gate Manager LP now owns 32,127 shares of the semiconductor company's stock worth $253,000 after acquiring an additional 3,926 shares during the period. Focused Alpha LLC purchased a new position in shares of United Microelectronics during the 4th quarter worth approximately $221,000. Coldstream Capital Management Inc. purchased a new position in shares of United Microelectronics during the 3rd quarter worth approximately $198,000. Finally, Franklin Resources Inc. grew its holdings in shares of United Microelectronics by 37.9% during the 2nd quarter. Franklin Resources Inc. now owns 24,735 shares of the semiconductor company's stock worth $189,000 after acquiring an additional 6,793 shares during the period. Hedge funds and other institutional investors own 5.05% of the company's stock.

United Microelectronics Company Profile

United Microelectronics Corporation (UMC) is a Taiwan-based semiconductor foundry that provides wafer fabrication and related manufacturing services to a global customer base. Founded in 1980, the company operates as a pure-play foundry, producing integrated circuits for a range of customers including fabless semiconductor companies and integrated device manufacturers. UMC is publicly listed NYSE: UMC and focuses on high-reliability manufacturing rather than branding consumer products.

UMC's core services encompass wafer fabrication using a portfolio of process technologies, with particular emphasis on mature and specialty nodes that support analog, power-management, radio-frequency (RF), and mixed-signal applications.

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