United Microelectronics Corporation (UMC) reached a significant support level, and could be a good pick for investors from a technical perspective. Recently, UMC's 50-day simple moving average broke out above its 200-day moving average; this is known as a "golden cross."There's a reason traders love a golden cross -- it's a technical chart pattern that can indicate a bullish breakout is on the horizon. This kind of crossover is formed when a stock's short-term moving average breaks above a longer-term movin ...

Group 1 - The significant appreciation of the New Taiwan Dollar (NTD) raises concerns about its negative impact on Taiwan's semiconductor industry, particularly for foundries like TSMC, UMC, and Vanguard [1] - A report indicates that for every 1% increase in the NTD, the gross margin of foundries typically decreases by 0.3% to 0.5%, suggesting a potential 3% to 5% hit to profit margins due to a 10% rise in the NTD since early Q2 [1][2] - Vanguard International Semiconductor Corporation (VIS) forecasts moderate growth for Q2, with demand for communication, industrial, and automotive semiconductors recovering [1] Group 2 - Assuming an exchange rate of 30.9 NTD to USD, VIS expects silicon wafer shipments to grow by 3% to 5% compared to the previous quarter, but gross margin is projected to decline from 30.1% in Q1 to between 27% and 29% [2] - UMC estimates that a 1% rise in the NTD will reduce its gross margin by approximately 0.4 percentage points, while World Advanced's gross margin may decrease by about 0.5 percentage points for the same rise [2][4] - TSMC predicts Q2 consolidated revenue of $28.4 to $29.2 billion, with a gross margin of 57% to 59% and an operating margin of 47% to 49%, but further appreciation of the NTD could pressure these margins [2] Group 3 - TSMC has not adjusted its guidance for Q2 or the full year in response to currency impacts and is closely monitoring exchange rate trends [3] - TSMC has requested its suppliers to submit cost reduction plans to mitigate the effects of the strong NTD [3]

Core Viewpoint - The global semiconductor sales continue to grow in Q1 2025, but there is a significant performance divergence among major chip manufacturers, influenced by market and product differences, particularly in AI and storage sectors, while automotive chip manufacturers are struggling [1]. Chip Design (Including IDM) - Texas Instruments (TI) reported Q1 revenue of $4.07 billion, a year-over-year increase of 11% and a sequential increase of 2%. The company expects Q2 revenue between $4.17 billion and $4.53 billion [3]. - STMicroelectronics (ST) reported Q1 revenue of $2.52 billion, a year-over-year decline of 27.3%, with a net profit of $56 million, down 89.1% [5]. - NXP's Q1 revenue was $2.84 billion, down 9% year-over-year, with a significant decline in automotive market revenue [6]. - Qualcomm's Q1 revenue reached $10.98 billion, a year-over-year increase of 16.9%, driven by growth in mobile, automotive, and IoT sectors [8]. - MediaTek's Q1 revenue was NT$153.31 billion, up 14.9% year-over-year, exceeding operational targets due to increased market demand [9]. Semiconductor Manufacturing - TSMC's Q1 revenue was $25.53 billion, a year-over-year increase of 35.3%, with a gross margin of 58.8% [42]. - UMC reported Q1 revenue of NT$57.86 billion, a year-over-year increase of 5.9%, with a focus on 22/28nm process technology [46]. - World Advanced's Q1 revenue was NT$11.949 billion, a year-over-year increase of 24%, achieving a net profit of NT$2.414 billion [48]. Chip Distribution - WPG Holdings reported Q1 revenue of NT$248.83 billion, a year-over-year increase of 36.8%, driven by demand from AI and related sectors [58]. - Winstek Technology's Q1 revenue was NT$247.4 billion, a year-over-year increase of 28% [60]. - Arrow Electronics reported a 6% year-over-year decline in sales, totaling $5.3 billion [64]. Domestic Semiconductor Companies - Over 70% of semiconductor companies listed in A-shares reported year-over-year revenue growth in Q1 2025, with 60.63% of companies showing profit increases [35]. - Weir Shares reported a 14.68% year-over-year revenue increase in Q1, with a net profit increase of 55.25% [38]. - Zhaoyi Innovation's Q1 revenue was 1.909 billion yuan, a year-over-year increase of 17.32% [40].

Financial Position - As of December 31, 2024, the total assets of United Microelectronics Corporation amounted to NT$570,200,677 thousand, an increase from NT$559,186,927 thousand in 2023, representing a growth of approximately 1.8%[30] - The company's total current assets decreased to NT$189,677,884 thousand in 2024 from NT$216,797,392 thousand in 2023, a decrease of approximately 12.5%[30] - The total non-current assets increased to NT$380,522,793 thousand in 2024 from NT$342,389,535 thousand in 2023, reflecting a growth of approximately 11.2%[30] - Total liabilities decreased to $192,015,673 in 2024 from $199,608,355 in 2023, a decline of about 3.3%[33] - Total current liabilities decreased to $75,260,189 in 2024 from $99,014,733 in 2023, a reduction of approximately 24%[33] - Total non-current liabilities increased to $116,755,484 in 2024, up from $100,593,622 in 2023, an increase of about 16%[33] - Total equity attributable to the parent company rose to $377,928,391 in 2024, compared to $359,237,713 in 2023, an increase of approximately 5.2%[33] Revenue and Profitability - Operating revenues for 2024 reached $232,302,584, an increase of 4% from $222,533,000 in 2023[35] - Gross profit decreased to $75,654,080 in 2024, down from $77,743,838 in 2023, reflecting a decline of approximately 2.7%[35] - Net income for 2024 was $47,106,256, a decrease of 23.4% compared to $61,439,817 in 2023[35] - Earnings per share (basic) fell to $3.80 in 2024 from $4.93 in 2023, representing a decline of 23%[35] - The company reported a total comprehensive income of $55,407,240 in 2024, down from $67,857,743 in 2023, a decrease of about 18.3%[35] Cash Flow and Investments - Cash generated from operations increased to NT$98,761,663 in 2024, compared to NT$94,809,302 in 2023, reflecting a growth of 4.1%[41] - Net cash provided by operating activities rose to NT$93,872,042 in 2024, up from NT$85,999,709 in 2023, indicating an increase of 9.8%[41] - Net cash used in investing activities decreased to NT$85,941,103 in 2024 from NT$97,786,542 in 2023, a reduction of 12.1%[41] - Cash dividends paid in 2024 were NT$37,585,606, down from NT$45,014,783 in 2023, representing a decrease of 16.3%[41] - The company reported a net decrease in cash and cash equivalents of NT$27,553,389 in 2024, compared to a decrease of NT$41,265,162 in 2023, showing an improvement of 33.2%[41] Assets and Liabilities - The company's cash and cash equivalents decreased to NT$105,000,226 thousand in 2024 from NT$132,553,615 thousand in 2023, reflecting a decline of about 20.8%[30] - Property, plant, and equipment increased significantly to NT$279,059,037 thousand in 2024, up from NT$239,123,248 thousand in 2023, marking an increase of about 16.7%[30] - The balance of unappropriated earnings as of December 31, 2024, is $190,120,643, highlighting retained earnings growth[37] - The acquisition of property, plant, and equipment in 2024 was NT$88,543,595, slightly lower than NT$91,473,668 in 2023, a decrease of 3.2%[41] Research and Development - Research and development expenses increased to $15,616,039 in 2024, up from $13,283,830 in 2023, reflecting a growth of approximately 17.5%[35] Changes in Ownership and Investments - The percentage of ownership in WAVETEK MICROELECTRONICS CORPORATION decreased from 80.00% in 2023 to 79.54% in 2024[69] - The company experienced changes in subsidiaries' ownership resulting in a net impact of $11,519 for the year 2024[37] - Cash dividends from investments accounted for under the equity method decreased to NT$1,071 million in 2024 from NT$1,870 million in 2023, reflecting a decline of approximately 42.6%[184] Compliance and Accounting Standards - The Company is currently evaluating the potential impact of new IFRS standards on its financial position and performance, with disclosures to follow upon completion of the evaluation[60] - The Company’s consolidated financial statements are prepared in accordance with IFRSs endorsed by the FSC, ensuring compliance with relevant regulations[61] - The company's consolidated financial statements are presented in New Taiwan Dollars (NTD), which is also the parent company's functional currency[78] Miscellaneous - The company executed a capital reduction and refunded NT$760 million from TRIKNIGHT in 2024, compared to NT$960 million in 2023, indicating a decrease of approximately 20.8%[188] - The company has various lease agreements with terms ranging from 2 to 31 years, with land use rights extending to 50 years, indicating a long-term commitment to its operational infrastructure[199]

Semiconductor Industry Trends - The semiconductor industry has experienced an economic downturn since early 2023, leading to reduced demand for consumer electronics and products incorporating semiconductors [27]. - The company anticipates significant fluctuations in operating revenues due to the cyclical nature of the semiconductor industry, with seasonal lows typically occurring in the first half of the year [29]. - The semiconductor industry is highly competitive, with new entrants and consolidations likely to create pricing pressures and potential overcapacity [42]. - The trend of increasing mergers and acquisitions in the semiconductor industry could reduce the total available customer base, potentially resulting in customer loss [52]. Operational Risks and Challenges - The company faces risks related to overcapacity in the semiconductor industry, which may lead to reduced revenues, earnings, and margins if unable to offset adverse effects through technology and product mix [35]. - The company relies on third-party vendors for essential services, and any delays or failures in these services could significantly reduce operating revenues and profitability [36]. - The company may face challenges in adopting new technologies, which could result in decreased profitability and loss of market share if competitors advance more rapidly [37]. - The outbreak of infectious diseases, such as COVID-19, may disrupt operations and negatively impact sales activities and customer orders [41]. - The company is vulnerable to natural disasters, with significant operational risks from earthquakes and water shortages in Taiwan, potentially impacting manufacturing capacity and financial performance [73]. - The company has faced severe earthquakes in the past, including a 7.2 magnitude earthquake in April 2024 and a 6.4 magnitude earthquake in January 2025, which caused damage to work-in-progress wafers [73]. Financial Performance and Customer Base - The company's top ten customers accounted for 52.4%, 62.0%, and 55.6% of operating revenues in 2022, 2023, and 2024, respectively [50]. - The largest customer from the wafer fabrication segment represented 8.6%, 13.1%, and 10.4% of operating revenues in 2022, 2023, and 2024, respectively [50]. - The company does not typically operate with significant backlog, making revenue forecasting challenging due to the cyclical nature of the semiconductor industry [51]. - The company expects future operating revenues to be substantially dependent on purchase orders received in the respective quarter [51]. - In 2024, the top ten customers accounted for 55.6% of the company's operating revenues [125]. - The company has a diversified customer base, with wafer sales by application in 2024 being 42.1% for communication, 28.4% for consumer, 13.5% for computer, and 16.0% for others [121]. Strategic Collaborations and Investments - A collaboration with Intel Corporation was established to develop a 12nm semiconductor process platform, with expected production of 12nm products in 2027, but this collaboration introduces additional operational risks [48]. - The company completed a US$664 million investment to acquire 100% ownership of United Semiconductor (Xiamen) Co., Ltd. in July 2023 [126]. - The collaboration with Intel Corporation aims to develop a new 12nm semiconductor process platform targeting high-growth markets such as mobile and communication infrastructure [139]. - The company expects to strengthen its market share by collaborating with DENSO for the production of power semiconductors to meet growing automotive market demand [141]. Research and Development - The company plans to enhance capital expenditures in research and development, focusing on logic and specialty process development to accelerate access to next-generation technologies [138]. - In 2022, 2023, and 2024, the company spent NT$12,953 million, NT$13,284 million, and NT$15,616 million (US$476 million) on research and development, representing 4.6%, 6.0%, and 6.7% of operating revenues for those years, respectively [211]. - As of December 31, 2024, the company employed 1,466 professionals in research and development activities, with additional management and operational personnel also involved [212]. - The company recognizes the importance of intelligent and cost-effective investments in R&D to enhance competitive edge without diluting profitability [142]. Environmental and Regulatory Compliance - Compliance with environmental, safety, and health regulations may lead to increased operational costs and capital expenditures, affecting overall results [74]. - The introduction of a carbon tax in Singapore and the "Climate Change Response Act" in Taiwan may increase operating and investment costs for the company [76]. - The company has implemented extensive Environmental, Safety, and Health (ESH) management systems certified to ISO 14001 and ISO 45001 standards [216]. - The company aims for zero incidents in occupational safety and health, fully complying with environmental laws and striving for zero pollution [217]. - The company has received numerous awards for its efforts in environmental protection, safety, and health management [221]. Geopolitical and Economic Risks - Geopolitical tensions, particularly between the U.S. and China, have led to significant tariffs on imports, including a 125% tariff on Chinese imports and a 32% tariff on Taiwanese goods, which could adversely affect the company's operations [97]. - The U.S. government has expanded export controls on advanced semiconductors, which may significantly increase compliance costs and restrict customer base [98]. - Political tensions in the Taiwan Strait could adversely affect business operations, including revenue and investment plans [98]. - The ongoing war between Ukraine and Russia has led to trade barriers that may increase manufacturing costs and limit access to supplies [100]. - Potential disruptions in supply chains due to geopolitical developments could negatively impact financial performance [101]. Manufacturing Capacity and Technology - A new advanced manufacturing facility in Singapore is expected to have a design capacity of 30,000 wafers per month, utilizing proprietary 22/28nm processes [127]. - The operational data as of December 31, 2024, shows that Fab 12A has an estimated full capacity of 136,279 wafers per month, while Fab 12i has a capacity of 57,207 wafers per month [146]. - UMC's 14nm FinFET technology offers 55% higher speed and twice the gate density compared to the 28nm process, with approximately 50% less power consumption [153]. - The total estimated capacity for UMC's fabs is projected to increase from 4,458 thousand 12-inch wafer equivalents in 2022 to 5,022 thousand in 2024, indicating a growth of 12.7% [159]. - Average capacity utilization rates dropped from 100.6% in 2022 to 68.5% in 2023, with a slight increase to 68.7% expected in 2024 [161]. - UMC is actively developing a 12nm FinFET Compact (12FFC) process, expected to complete process verification in 2026 and enter production in 2027 [153]. - The company emphasizes maintaining high manufacturing quality standards to achieve consistent, high manufacturing yields, enabling customers to estimate wafer orders accurately [144]. Intellectual Property and Legal Risks - The company is subject to U.S. conflict minerals law, requiring due diligence on supply chains, which may impact the ability to source materials effectively [88]. - Intellectual property disputes could result in costly litigation and divert management resources, potentially harming business operations [93]. - The company may incur substantial legal expenses related to infringement claims, impacting operational costs [99]. Customer Relations and Services - The company has established a partnership business model to better accommodate customer needs and optimize the entire value chain [135]. - The company has been recognized among the top 5% of companies in corporate governance evaluations for ten consecutive years [119]. - The company has a strong commitment to high-quality service, which has been a key factor in attracting major customers like Texas Instruments and Intel [125]. - Company’s online service "MyUMC" provides 24-hour access to detailed account information and manufacturing data [189].

Financial Data and Key Metrics Changes - UMC's consolidated revenue for Q1 2025 was NT$57.86 billion, with a gross margin of approximately 26.7% [7] - Net income attributable to shareholders was NT$7.78 billion, resulting in an earnings per share (EPS) of NT$0.62 [8] - Year-over-year revenue increased by 5.9%, driven by a 12% increase in wafer shipments, although this was offset by a decline in average selling price (ASP) [11] - Operating expenses were controlled at about 10.6% of total revenue, leading to an operating income of NT$9.7 billion, or 15.9% [10] Business Line Data and Key Metrics Changes - Wafer revenue declined 4.2% sequentially to NT$57.85 billion due to a one-time price adjustment and lower ASP [9] - The consumer segment showed strong performance, primarily driven by products like Wi-Fi, DTV, and set-top boxes [14] - Revenue from 22 and 28 nanometer products accounted for 37% of total sales, with 22 nanometer revenue increasing by 46% quarter-over-quarter [17] Market Data and Key Metrics Changes - Asian-based customers contributed approximately 56% of total revenue, while North American customers represented about 22% [12] - The automotive segment experienced a decline in Q1 due to softness in microcontrollers and power management, while consumer electronics showed growth [68] Company Strategy and Development Direction - UMC is focusing on technology differentiation, global manufacturing diversification, and product mix optimization to navigate macro uncertainties [20] - The company plans to maintain a cash-based capital expenditure (CapEx) of $1.8 billion for 2025 [15] - The new Singapore Phase 3 fab is expected to ramp up to volume production in early 2026, enhancing UMC's capacity for 22 nanometer products [18] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding wafer demand projections due to ongoing tariff adjustments and geopolitical tensions [20] - For Q2 2025, UMC expects a moderate rebound in demand across all segments, with wafer shipments projected to increase by 5% to 7% sequentially [21] - The gross margin is anticipated to recover to approximately 30% in Q2 [21] Other Important Information - UMC's cash position remained strong at NT$106 billion at the end of Q1 2025, with total equity reaching NT$390 billion [12] - A proposed cash dividend of NT$2.85 per share is subject to shareholder approval at the upcoming AGM [19] Q&A Session Summary Question: Impact of tariffs on customer order behaviors - Management noted that while tariffs have increased uncertainties, there has not been a significant change in market demand for Q2 2025 [26][28] Question: Utilization rates for 22 and 28 nanometer products - The guidance for Q2 indicates a mid-70% utilization rate for the company, with 22 and 28 nanometer products expected to be key growth drivers [36][37] Question: Update on the partnership with Intel for 12 nanometer - The joint development is on track, with pilot runs underway and expected to be ready for customer adoption by 2026 [42][44] Question: Margin expectations for Q2 and beyond - Management indicated that while Q1 margins were impacted by a one-time pricing adjustment, they expect improvements in Q2, but visibility for the second half remains limited [55][98] Question: Demand trends across key end markets - Management expects growth in consumer and computing segments for Q2, while automotive demand remains flattish [68][70] Question: Inventory levels across different applications - Current inventory levels are healthy for consumer electronics, but higher for automotive and industrial segments, which may take longer to digest [118][120]

Financial Performance - Operating Revenues for 1Q25 were NT$57,859 million, a decrease of 4.2% QoQ from NT$60,386 million in 4Q24 [7, 8] - Net Income Attributable to Shareholders of the Parent for 1Q25 was NT$7,777 million, a decrease of 8.5% QoQ from NT$8,497 million in 4Q24 [7, 8] - EPS (NTD) for 1Q25 was 0.62, compared to 0.68 in 4Q24 [7, 8] - Operating Revenues increased by 5.9% YoY from NT$54,632 million in 1Q24 to NT$57,859 million in 1Q25 [7, 10] - Net Income Attributable to Shareholders of the Parent decreased by 25.6% YoY from NT$10,456 million in 1Q24 to NT$7,777 million in 1Q25 [7, 10] - EPS (NTD) decreased from 0.84 in 1Q24 to 0.62 in 1Q25 [7, 10] Foundry Segment - Wafer Shipments for 1Q25 were 910 thousand (12" wafer eq), compared to 909 thousand in 4Q24 [7] - Utilization rate for 1Q25 was 69%, compared to 70% in 4Q24 [7] - In 1Q25, 66% of Foundry Segment Sales came from Asia [17] - In 1Q25, 82% of Foundry Segment Sales came from Fabless customers [19] - In 1Q25, 39% of Foundry Segment Sales came from Communication applications [21] - In 1Q25, 50% of Foundry Segment Sales came from ≤ 40nm technology [23] Capacity and Expenditure - Total capacity for 1Q25 was 1,264 thousand (12" eq), compared to 1,280 thousand in 4Q24 [25] - The 2025 Foundry Capital Expenditure Plan is USD 1.8 billion, with 90% allocated to 12" and 10% to 8" [26]

UNITED MICROELECTRONICS CORPORATION AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS WITH REPORT OF INDEPENDENT AUDITORS FOR THE THREE-MONTH PERIODS ENDED MARCH 31, 2025 AND 2024 Address: No. 3 Li-Hsin 2nd Road, Hsinchu Science Park, Hsinchu, Taiwan, R.O.C. Telephone: 886-3-578-2258 Based on our reviews and the review reports of other independent auditors (please refer to the Other Matter paragraph of our report), nothing has come to our attention that causes us to believe that the accompanying consolidat ...

市场消息：晶圆代工企业联电被问及有关与同业格芯（格罗方德）合作的相关媒体报导时表示，目前未 有合并活动。 ...

Group 1 - United Microelectronics Corporation (UMC) shares increased by 9.2% to close at $7.15, with notable trading volume compared to typical sessions, contrasting with a 1.6% gain over the past four weeks [1] - UMC is experiencing strong demand for AI-driven services, increased semiconductor content in devices, and growing adoption of its 22nm specialty platform, with a new semiconductor fab in Singapore set to begin volume production in 2026, boosting capacity to over 1 million wafers annually [2] - The company is expected to report quarterly earnings of $0.10 per share, reflecting a year-over-year decline of 23.1%, while revenues are projected to be $1.81 billion, an increase of 5.9% from the previous year [3] Group 2 - The consensus EPS estimate for UMC has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [4] - UMC holds a Zacks Rank of 3 (Hold), indicating a neutral outlook, while Qualcomm (QCOM), another company in the same industry, closed 0.6% higher at $153.61, with a return of -2.8% over the past month [4] - Qualcomm's consensus EPS estimate has also remained unchanged at $2.79, representing a year-over-year increase of 14.3%, and it holds a Zacks Rank of 3 (Hold) [5]