Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

United Microelectronics Corp / Equity Bottom-Up

<ul>
<li>1Q miss on non-ops and it’s the bottom for margins. Strong 2Q guidance but very low visibility into 2H: tariff uncertainty.  </li>
<li>The JV with Intel for 12nm is proceeding well and demand is strong for Made in US 12nm. Some upside here for 2027</li>
<li>Consensus is probably a tad too low but the stock trading at average PEx ~12x. No arbitrage here.</li>
</ul>


1Q miss on non-ops and it’s the bottom for margins. Strong 2Q guidance but very low visibility into 2H: tariff uncertainty.  
The JV with Intel for 12nm is proceeding well and demand is strong for Made in US 12nm. Some upside here for 2027
Consensus is probably a tad too low but the stock trading at average PEx ~12x. No arbitrage here.


UMC 1Q25 Is the Bottom, Consensus Is Low but the Stock at Average Valuations

Taiwan Tech Focused Senior Analyst

Patrick Liao

United Microelectron Sp Adr / Equity Bottom-Up

<ul>
<li>2Q25 guidance: Wafer shipments: increase 5~7%, ASP in USD: flat, GM: About 30%.</li>
<li>The US tariffs affect customer outcome visibility in 2Q25 and 2H25 is limited. </li>
<li>UMC is seeking a strategic plan to enhance shareholder value, and there is no ongoing merger plan at the moment, which implies no merger plan with GF. </li>
</ul>


2Q25 guidance: Wafer shipments: increase 5~7%, ASP in USD: flat, GM: About 30%.
The US tariffs affect customer outcome visibility in 2Q25 and 2H25 is limited. 
UMC is seeking a strategic plan to enhance shareholder value, and there is no ongoing merger plan at the moment, which implies no merger plan with GF. 


UMC (2303.TT; UMC.US): 2Q25 Guidance Beat; Tariff Affection Unknown; No GF Merger Plan Right Now.

<ul>
<li>Both <a href="https://www.smartkarma.com/entities/united-microelectron-sp-adr" target="_blank" data-smartkarma-citation="entities:11540:1" rel="noopener">United Microelectron Sp Adr (UMC US)</a> and <a href="https://www.smartkarma.com/entities/globalfoundries-inc" target="_blank" data-smartkarma-citation="entities:34513:1" rel="noopener">GLOBALFOUNDRIES (GFS US)</a> saw positive reactions in their stocks following a possible merger news, despite the current instability in the stock markets.  </li>
<li>Although <a href="https://www.smartkarma.com/entities/globalfoundries-inc" target="_blank" data-smartkarma-citation="entities:34513:1" rel="noopener">GLOBALFOUNDRIES (GFS US)</a>'s technology is held above 7nm, it is ahead of <a href="https://www.smartkarma.com/entities/united-microelectron-sp-adr" target="_blank" data-smartkarma-citation="entities:11540:1" rel="noopener">United Microelectron Sp Adr (UMC US)</a>, which is still certain generations above China’s current technology in general.  </li>
<li>If these two companies wish to merge, there are still some subjective factors that need to be considered, and it will not be easy to get approval.  </li>
</ul>


Both United Microelectron Sp Adr (UMC US) and GLOBALFOUNDRIES (GFS US) saw positive reactions in their stocks following a possible merger news, despite the current instability in the stock markets.  
Although GLOBALFOUNDRIES (GFS US)'s technology is held above 7nm, it is ahead of United Microelectron Sp Adr (UMC US), which is still certain generations above China’s current technology in general.  
If these two companies wish to merge, there are still some subjective factors that need to be considered, and it will not be easy to get approval.  


UMC (2303.TT; UMC.US): Merges with GFS? It Should Be a Terrific, but It Won't Be Easy to Happen.

<ul>
<li>The 1Q25 outlook is slightly affected by earthquakes, but production can resume in late 1Q25.</li>
<li>The UMC 12nm project could be in vain if Intel collaborates with TSMC or if TSMC takes over Intel's foundry service.   </li>
<li>UMC's annual revenue could see a -5% year-over-year growth in 2025, but there may be a few percentages increase in wafer shipments.  </li>
</ul>


The 1Q25 outlook is slightly affected by earthquakes, but production can resume in late 1Q25.
The UMC 12nm project could be in vain if Intel collaborates with TSMC or if TSMC takes over Intel's foundry service.   
UMC's annual revenue could see a -5% year-over-year growth in 2025, but there may be a few percentages increase in wafer shipments.  


UMC (2303.TT; UMC.US): 1Q25 Results Could Be Upbeat, but 2Q25 Could Be a Bit Downside.

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

<ul>
<li>UMC Secures Key Qualcomm Advanced Packaging Order; Breakthrough in High-Growth Chip Supply Chain Segment</li>
<li>Why TSMC Remains Critical for QCOM Manufacturing, Yet UMC Provides a Strong Strategic Counterbalance</li>
<li>UMC Must Prove Itself, but QCOM Win Sparks Optimism for Sentiment and Outlook Recovery -- Maintain TSMC as Structural Long &amp; Rate UMC as Outperform</li>
</ul>


UMC Secures Key Qualcomm Advanced Packaging Order; Breakthrough in High-Growth Chip Supply Chain Segment
Why TSMC Remains Critical for QCOM Manufacturing, Yet UMC Provides a Strong Strategic Counterbalance
UMC Must Prove Itself, but QCOM Win Sparks Optimism for Sentiment and Outlook Recovery -- Maintain TSMC as Structural Long &amp; Rate UMC as Outperform


United Microelectronics: Key QCOM Advanced Packaging Win Signals Client Shift Away from TSMC

Taiwan

United Microelectronics Corporation designs, manufactures, and markets integrated circuits (ICs) and related electronic products.  The Company's main products are consumer electronic ICs, memory ICs, personal computer peripheral ICs, and communication ICs.

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United Microelectron Sp Adr (UMC US)

UMC 1Q25 Is the Bottom, Consensus Is Low but the Stock at Average Valuations

UMC: 1Q miss, strong 2Q guidance but low visibility into 2H. JV with Intel for 12nm progressing well with strong demand for 2027. Stock trading at...

Nicolas Baratte

UMC (2303.TT; UMC.US): 2Q25 Guidance Beat; Tariff Affection Unknown; No GF Merger Plan Right Now.

UMC's 2Q25 guidance shows increased wafer shipments and flat ASP, with limited visibility due to US tariffs. Strategic plan in place to enhance...

Patrick Liao

UMC (2303.TT; UMC.US): Merges with GFS? It Should Be a Terrific, but It Won't Be Easy to Happen.

Stocks of UMC US and GFS US rise on possible merger news despite market instability. GFS ahead in technology but merger faces challenges.

Patrick Liao

UMC (2303.TT; UMC.US): 1Q25 Results Could Be Upbeat, but 2Q25 Could Be a Bit Downside.

Earthquakes impact 1Q25 outlook can be resumed, UMC's 12nm project at risk with Intel-TSMC collaboration, UMC's revenue may decrease but wafer...

Patrick Liao

United Microelectronics: Key QCOM Advanced Packaging Win Signals Client Shift Away from TSMC

UMC secures key Qualcomm order, providing strategic counterbalance to TSMC in chip supply chain segment. Optimism likely to improve for UMC's...

Vincent Fernando, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

UMC 1Q25 Is the Bottom, Consensus Is Low but the Stock at Average Valuations

UMC: 1Q miss, strong 2Q guidance but low visibility into 2H. JV with Intel for 12nm progressing well with strong demand for 2027. Stock trading at...

Nicolas Baratte

UMC (2303.TT; UMC.US): 2Q25 Guidance Beat; Tariff Affection Unknown; No GF Merger Plan Right Now.

​UMC's 2Q25 guidance shows increased wafer shipments and flat ASP, with limited visibility due to US tariffs. Strategic plan in place to enhance...

Patrick Liao

UMC (2303.TT; UMC.US): Merges with GFS? It Should Be a Terrific, but It Won't Be Easy to Happen.

​Stocks of UMC US and GFS US rise on possible merger news despite market instability. GFS ahead in technology but merger faces challenges.

Patrick Liao

UMC (2303.TT; UMC.US): 1Q25 Results Could Be Upbeat, but 2Q25 Could Be a Bit Downside.

​Earthquakes impact 1Q25 outlook can be resumed, UMC's 12nm project at risk with Intel-TSMC collaboration, UMC's revenue may decrease but wafer...

Patrick Liao

United Microelectronics: Key QCOM Advanced Packaging Win Signals Client Shift Away from TSMC

​UMC secures key Qualcomm order, providing strategic counterbalance to TSMC in chip supply chain segment. Optimism likely to improve for UMC's...

Vincent Fernando, CFA

UMC's 2Q25 guidance shows increased wafer shipments and flat ASP, with limited visibility due to US tariffs. Strategic plan in place to enhance...

Stocks of UMC US and GFS US rise on possible merger news despite market instability. GFS ahead in technology but merger faces challenges.

Earthquakes impact 1Q25 outlook can be resumed, UMC's 12nm project at risk with Intel-TSMC collaboration, UMC's revenue may decrease but wafer...

UMC secures key Qualcomm order, providing strategic counterbalance to TSMC in chip supply chain segment. Optimism likely to improve for UMC's...