Taiwan’s ‘Other’ Chip Giant Clocks Strong Performance As Consumer Demand Roars Back
Taiwan-based United Microelectronics Corp, a prominent global semiconductor foundry, reported fiscal first-quarter results on Wednesday.
For the quarter, the company reported revenue of $1.93 billion (61.04 billion New Taiwanese dollars), up 5.5% year-on-year.
The figure marginally missed the analyst consensus estimate of $1.97 billion. On a sequential basis, revenue declined by 1.2%.
Earnings per American Depositary Share (ADS) came in at 20.4 cents, also topping the analyst consensus of 12 cents.
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Advanced Node Contribution and Margins
The company reported solid progress in its advanced process nodes, with 22nm and 28nm technologies contributing 34% of wafer revenue, down from 37% year-over-year and 36% in the prior quarter.
Revenue from 40nm technology rose to 18% from 16% a year earlier, and 17% in the fourth quarter of 2025.
Capacity utilization also strengthened, improving to 79% from 69% a year ago and 78% in the previous quarter.
The gross margin rose to 29.2% from 26.7% in the same period last year. The operating margin for the quarter was 18.50%, up from 16.90% in the prior year quarter.
Capital expenditures for the quarter totaled $416 million.
Executive Commentary
UMC CEO Jason Wang said first-quarter wafer shipments rose 2.7% quarter-on-quarter, driven by strong consumer demand, which lifted utilization to 79%.
He noted that, despite a decline in average selling prices, driven in part by higher 8-inch shipments, gross margin remained steady at 29.2%.
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Wang added that demand for 22nm logic and specialty processes continued to build, with 22nm revenue reaching a record and accounting for 14% of total revenue. He said more than 50 customers are expected to complete tape-outs on 22nm platforms by year-end across applications such as display drivers, networking chips, and microcontrollers.
He also highlighted ongoing investments beyond 22nm, including a 12nm collaboration with Intel to maintain technology continuity and U.S.-based manufacturing, as well as new initiatives such as a partnership to deploy thin-film lithium niobate photonics for AI infrastructure.
Looking ahead, Wang said UMC expects strong shipment growth in the second quarter across both 8-inch and 12-inch wafers, supported by a rebound in the communications market and steady demand from the computer, consumer, and industrial markets.
