UMC Clocks 10% Sequential Revenue Decline In Q4; Issues Cautious Outlook

  • United Microelectronics Corp UMC reported fourth-quarter FY22 revenue growth of 14.8% year-on-year to $2.21 billion (NT$67.84 billion), beating the consensus of $2.15 billion. The revenue decreased by 10% Q/Q due to inventory correction within the semi-industry, which lowered wafer shipments.
  • Revenue from 22 and 28nm grew to 28% of the wafer revenue, while 40nm contributed 17% of sales. 
  • The gross margin expanded by 380 basis points to 42.9%. 
  • Earnings per ADS of $0.251 beat the consensus of $0.250.
  • Capital expenditure spending totaled $1.2 billion.
  • Jason Wang, co-president of UMC, said, "In the fourth quarter, due to a significant slowdown across most of our end markets and inventory correction in the semiconductor industry, our wafer shipments fell 14.8% QoQ while overall fab utilization rate dropped to 90%. Average selling price increased slightly during the quarter as a result of our ongoing product mix optimization efforts, moderating the decline in revenue."
  • Outlook: UMC expects Q1 FY23 wafer shipments to decrease in the high teens % range. It expects the ASP in USD to remain flat. It expects capacity utilization of 70%.
  • UMC sees a 2023 capex of $3.0 billion.
  • Price Action: UMC shares closed lower by 0.92% at $7.50 on Friday.
  • Photo Via Company
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