United Microelectronics (NYSE:UMC) Issues Earnings Results

Key Points

• UMC beat second-quarter expectations: Earnings reached $0.53 per share versus the $0.16 consensus estimate, while revenue of $2.16 billion slightly exceeded forecasts. Revenue rose 12.6% sequentially to TWD 68.73 billion, with gross margin at 32.5% and utilization at 85%.
• Management anticipates stronger third-quarter momentum, forecasting high-single-digit shipment growth, utilization above 90%, and gross margin in the mid-30% range. UMC also raised 2026 capital-expenditure plans to $2 billion and is expanding Singapore and Tainan capacity to support AI-related demand.
• The recovery remains uneven: Handset, PC, and notebook demand may decline year over year, customer inventories remain elevated, and higher investment is expected to increase depreciation and pressure future margin expansion. Analysts remain cautious, with MarketBeat reporting a “Strong Sell” consensus rating.

United Microelectronics (NYSE:UMC - Get Free Report) released its quarterly earnings results on Wednesday. The semiconductor company reported $0.53 EPS for the quarter, topping the consensus estimate of $0.16 by $0.37, FiscalAI reports. The business had revenue of $2.16 billion during the quarter, compared to analyst estimates of $2.14 billion. United Microelectronics had a return on equity of 13.67% and a net margin of 20.71%.

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

• Second-quarter performance improved: Revenue rose 12.6% quarter over quarter to TWD 68.73 billion, gross margin reached 32.5%, utilization increased to 85%, and wafer shipments grew 10.6%.
• UMC expects continued momentum in the third quarter, guiding for high-single-digit shipment growth, utilization above 90%, firm U.S.-dollar ASPs, and gross margin in the mid-30% range, supported by power-management ICs, sensors, microcontrollers, and a rebound in 8-inch demand.
• Management projects AI-related revenue of approximately US$300 million in 2026 and more than US$1 billion within three years, spanning connectivity, power management, FPGA, advanced packaging, and silicon photonics.
• The board approved phased capacity investments, including clean-room expansion at Singapore P4 and a new Tainan fab for advanced packaging; 2026 CapEx was raised to US$2 billion from US$1.5 billion to prepare for AI-driven demand.
• Management said the recovery is not yet broad-based; handset, PC, and notebook demand is expected to decline year over year, while customer inventories remain elevated in consumer, smartphone, automotive, and industrial segments. Increased investment is also expected to drive low-teens annual depreciation growth for at least the next two years, potentially limiting gross-margin expansion.

United Microelectronics Stock Performance

Shares of NYSE UMC traded up $0.01 during midday trading on Wednesday, reaching $17.36. 11,521,981 shares of the company were exchanged, compared to its average volume of 13,803,392. The stock has a market cap of $43.72 billion, a P/E ratio of 26.69, a PEG ratio of 2.26 and a beta of 1.58. The company has a current ratio of 2.72, a quick ratio of 2.23 and a debt-to-equity ratio of 0.12. United Microelectronics has a 1 year low of $6.56 and a 1 year high of $28.96. The stock has a fifty day simple moving average of $22.54 and a 200 day simple moving average of $14.94.

United Microelectronics Increases Dividend

The business also recently declared an annual dividend, which will be paid on Thursday, August 6th. Investors of record on Wednesday, July 8th will be issued a dividend of $0.4122 per share. This is an increase from United Microelectronics's previous annual dividend of $0.37. This represents a dividend yield of 166.0%. The ex-dividend date of this dividend is Wednesday, July 8th. United Microelectronics's dividend payout ratio is 49.23%.

Key Stories Impacting United Microelectronics

Here are the key news stories impacting United Microelectronics this week:

• Positive Sentiment: Q2 earnings beat expectations: UMC reported earnings of $0.53 per share, well above the $0.16 consensus estimate, while revenue of $2.16 billion slightly exceeded forecasts. Separately, the company reported second-quarter revenue of NT$68.73 billion, up 12.6% sequentially and 17.0% year over year, with a 32.5% gross margin. UMC Reports Second Quarter 2026 Results
• Positive Sentiment: AI-related capacity expansion: UMC’s board approved additional cleanroom capacity at its Singapore facility and construction of a new fab building at its Tainan campus. The investments are intended to address accelerating AI-driven demand and support future revenue growth. Taiwan's UMC raises 2026 capex
• Positive Sentiment: Technology and analyst support: UMC expects Intel 12-nanometer design kits by year-end and said silicon photonics production is underway. Wedbush raised its price target following the results, while Zacks added UMC to its Rank #1 momentum-stock list. United Microelectronics price target raised at Wedbush
• Neutral Sentiment: UMC filed its reviewed second-quarter financial statements with the U.S. Securities and Exchange Commission, providing formal regulatory disclosure of the results. UMC files reviewed Q2 financials
• Negative Sentiment: The stock had fallen sharply ahead of the earnings release, reflecting investor caution and marking its fourth consecutive declining session. Higher capital spending for new capacity could also pressure near-term cash flow before the investments generate returns. UMC declines ahead of earnings

Analyst Ratings Changes

UMC has been the subject of a number of research reports. Wall Street Zen upgraded shares of United Microelectronics from a "hold" rating to a "buy" rating in a report on Saturday. BNP Paribas Exane reissued an "underperform" rating on shares of United Microelectronics in a research report on Thursday, May 28th. Finally, Weiss Ratings restated a "hold (c)" rating on shares of United Microelectronics in a research note on Tuesday, May 26th. One equities research analyst has rated the stock with a Hold rating and three have assigned a Sell rating to the stock. According to MarketBeat.com, the stock has a consensus rating of "Strong Sell" and a consensus target price of $8.60.

Institutional Investors Weigh In On United Microelectronics

Several institutional investors have recently modified their holdings of the company. Sivia Capital Partners LLC raised its position in United Microelectronics by 25.8% during the second 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 last quarter. EP Wealth Advisors LLC purchased a new position in United Microelectronics during the fourth quarter worth about $134,000. Cetera Investment Advisers raised its stake in United Microelectronics by 7.7% during the fourth quarter. Cetera Investment Advisers now owns 15,472 shares of the semiconductor company's stock worth $122,000 after purchasing an additional 1,103 shares during the period. GeoWealth Management LLC lifted its stake in shares of United Microelectronics by 10.2% in the 3rd quarter. GeoWealth Management LLC now owns 15,710 shares of the semiconductor company's stock valued at $119,000 after purchasing an additional 1,459 shares in the last quarter. Finally, Osaic Holdings Inc. boosted its position in United Microelectronics by 11.5% during the 2nd quarter. Osaic Holdings Inc. now owns 14,756 shares of the semiconductor company's stock worth $113,000 after purchasing an additional 1,516 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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