United Microelectronics Co (UMC, 聯電), the world’s No. 2 foundry service provider, yesterday posted record net profit for last quarter, as growing demand for automotive, server and networking chips helped offset weakness in the smartphone and notebook computer segments due to China’s lockdowns.
Orders for automotive, server and networking chips accounted for more than 20 percent of UMC’s revenue, it said.
Net profit last quarter soared about 90 percent to NT$19.81 billion (US$673.9 million) from NT$10.43 billion a year earlier and gained 24.2 percent from NT$15.95 billion the previous quarter, UMC said.
Photo: Grace Hung, Taipei Times
Gross margin jumped to 43.4 percent, exceeding its estimate of 40 percent and hitting the highest in about 22 years.
Despite the economic turbulence, UMC said it still aims for revenue to grow by at least 20 percent this year, given that 40 percent of its wafer capacity is under long-term supply agreements.
On Tuesday, UMC said it signed a supply agreement with Japan’s Denso Corp to build wafer capacity to produce automotive chips at UMC’s Japanese fab from next year.
“For 2022, it remains a challenge for us to meet rising demand. In the near term, neither demand nor inventory fluctuations at customers has imbalanced supply and demand for UMC,” UMC copresident Jason Wang (王石) told a quarterly meeting yesterday.
“Our outlook for 2022 remains solid,” Wang added.
UMC maintains its forecast that average selling prices are to increase 14 to 16 percent this year, Wang said.
The firm has raised this year’s capital expenditure to US$3.6 billion from an earlier budget of US$3 billion, as it adds more capacity at its Tainan and Singapore fabs.
UMC said that its capacity this year is expected to increase 20 percent, compared with last year.
The firm said it expects wafer shipments this quarter to be as much as 5 percent higher than last quarter, while wafer prices are expected to rise 3 to 5 percent.
Gross margin is expected to increase to about 45 percent this quarter, thanks to price hikes and a better product mix, it said, adding that factory utilization would be 100 percent.
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