Taiwan Tech Focused Senior Analyst

Patrick Liao

Equity Bottom-Up

United Microelectronics Corp / Equity Bottom-Up

<ul>
<li>UMC expects macro uncertainties and cost headwinds to linger into 2H24. </li>
<li>The P3 project has received strong support from the Singapore government with a US$5 billion Capex. </li>
<li>UMC has seen high interest from customers for its 14nm capacity. </li>
</ul>


UMC expects macro uncertainties and cost headwinds to linger into 2H24. 
The P3 project has received strong support from the Singapore government with a US$5 billion Capex. 
UMC has seen high interest from customers for its 14nm capacity. 


UMC (2303.TT; UMC.US): 2Q14F in Line; Singapore Fab Expansion Received Adds.

<ul>
<li>The 1Q24F guidance is expected to decrease by 2-3% QoQ. However, we believe there is a good chance of achieving a flat QoQ performance.</li>
<li>Production is expected to be ready by 2027F, with the process likely to be prepared by 2025F and enter pilot run in 2026F.  </li>
<li>The semiconductor market is expected to grow at a high single-digit rate, while the foundry market is expected to grow close to 10% YoY in 2024F.  </li>
</ul>


The 1Q24F guidance is expected to decrease by 2-3% QoQ. However, we believe there is a good chance of achieving a flat QoQ performance.
Production is expected to be ready by 2027F, with the process likely to be prepared by 2025F and enter pilot run in 2026F.  
The semiconductor market is expected to grow at a high single-digit rate, while the foundry market is expected to grow close to 10% YoY in 2024F.  


UMC (2303.TT; UMC.US): 1Q24F Guidance Is Slightly Lower than 4Q23; Intel Project Grasps Attention

<ul>
<li>The <a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)'s</a> updated revenue outlook for 1Q24F suggests that it could be relatively flat QoQ..</li>
<li>UMC's Asian clients, particularly <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" data-smartkarma-citation="entities:772:1" rel="noopener">Mediatek Inc (2454 TT)</a> and <a href="https://www.smartkarma.com/entities/novatek-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:10904:1" rel="noopener">Novatek Microelectronics Corp (3034 TT)</a>, are experiencing increased demand in 1Q24F.</li>
<li>On the other hand, European and American clients are more bearish in 1Q24F and have not shown signs of improvement yet.</li>
</ul>


The United Microelectronics Corp (2303 TT)'s updated revenue outlook for 1Q24F suggests that it could be relatively flat QoQ..
UMC's Asian clients, particularly Mediatek Inc (2454 TT) and Novatek Microelectronics Corp (3034 TT), are experiencing increased demand in 1Q24F.
On the other hand, European and American clients are more bearish in 1Q24F and have not shown signs of improvement yet.


UMC (2303.TT; UMC.US): 1Q24F Outlook Could Be Flat QoQ; Asian Clients Show Optimism.

<ul>
<li>The wafer demand outlook for 1Q24F should be around flat, but ASP (Average Selling Price) is expected to decline by negative mid-single digits.</li>
<li>Compared to 4Q23, <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" data-smartkarma-citation="entities:772:1" rel="noopener">Mediatek Inc (2454 TT)</a>'s foundry demand is larger and <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>'s foundry demand is downsized in 1Q24F. </li>
<li>
<a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)</a> and <a href="https://www.smartkarma.com/entities/intel-corp" target="_blank" data-smartkarma-citation="entities:16764:1" rel="noopener">Intel Corp (INTC US)</a> are currently discussing the allocation issue of 12nm capacity.</li>
</ul>


The wafer demand outlook for 1Q24F should be around flat, but ASP (Average Selling Price) is expected to decline by negative mid-single digits.
Compared to 4Q23, Mediatek Inc (2454 TT)'s foundry demand is larger and Samsung Electronics (005930 KS)'s foundry demand is downsized in 1Q24F. 

United Microelectronics Corp (2303 TT) and Intel Corp (INTC US) are currently discussing the allocation issue of 12nm capacity.


UMC (2303.TT; UMC.US): 1Q24F Outlook, the Wafer Demand of MediaTek and Samsung.

United Microelectron Sp Adr / Equity Bottom-Up

<ul>
<li>Although it is still early to determine the extent of the utilization rate that could be reached in UMC for 2Q24F, there is a greater chance for a rebound.</li>
<li>UMC's high-end technology, specifically 28nm, has a utilization rate of over 80% in 4Q23F. </li>
<li>MediaTek is UMC's largest client, dominating in WiFi, TV SoC, Bluetooth, and other areas.</li>
</ul>


Although it is still early to determine the extent of the utilization rate that could be reached in UMC for 2Q24F, there is a greater chance for a rebound.
UMC's high-end technology, specifically 28nm, has a utilization rate of over 80% in 4Q23F. 
MediaTek is UMC's largest client, dominating in WiFi, TV SoC, Bluetooth, and other areas.


UMC (2303.TT; UMC.US): There Is a Greater Chance for a Rebound in 2Q24F.

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 Microelectronics Corp (2303 TT)

UMC (2303.TT; UMC.US): 2Q14F in Line; Singapore Fab Expansion Received Adds.

UMC still a bit conservative into 2H24F. The P3 project has received strong support from the Singapore government with a US$5 billion Capex.

Patrick Liao

UMC (2303.TT; UMC.US): 1Q24F Guidance Is Slightly Lower than 4Q23; Intel Project Grasps Attention

The 1Q24F guidance may decrease slightly, but there is potential for a steady performance. Production in Intel's Fab is set for 2027F. Currently,...

Patrick Liao

UMC (2303.TT; UMC.US): 1Q24F Outlook Could Be Flat QoQ; Asian Clients Show Optimism.

UMC's updated revenue outlook for 1Q24F suggests flat growth compared to 4Q23, with increased demand from Asian clients but bearish sentiment from...

Patrick Liao

UMC (2303.TT; UMC.US): 1Q24F Outlook, the Wafer Demand of MediaTek and Samsung.

The wafer demand for 1Q24F is expected to be flat, but the ASP is projected to decline. MediaTek's demand is larger while Samsung's is downsized....

Patrick Liao

UMC (2303.TT; UMC.US): There Is a Greater Chance for a Rebound in 2Q24F.

UMC's 28nm has a utilization rate of over 80% in 4Q23F. It is early to determine the utilization rate could be reached in 2Q24F, there is a greater...

Patrick Liao

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UMC (2303.TT; UMC.US): 2Q14F in Line; Singapore Fab Expansion Received Adds.

UMC still a bit conservative into 2H24F. The P3 project has received strong support from the Singapore government with a US$5 billion Capex.

Patrick Liao

UMC (2303.TT; UMC.US): 1Q24F Guidance Is Slightly Lower than 4Q23; Intel Project Grasps Attention

The 1Q24F guidance may decrease slightly, but there is potential for a steady performance. Production in Intel's Fab is set for 2027F. Currently,...

Patrick Liao

UMC (2303.TT; UMC.US): 1Q24F Outlook Could Be Flat QoQ; Asian Clients Show Optimism.

​UMC's updated revenue outlook for 1Q24F suggests flat growth compared to 4Q23, with increased demand from Asian clients but bearish sentiment from...

Patrick Liao

UMC (2303.TT; UMC.US): 1Q24F Outlook, the Wafer Demand of MediaTek and Samsung.

​The wafer demand for 1Q24F is expected to be flat, but the ASP is projected to decline. MediaTek's demand is larger while Samsung's is downsized....

Patrick Liao

UMC (2303.TT; UMC.US): There Is a Greater Chance for a Rebound in 2Q24F.

UMC's 28nm has a utilization rate of over 80% in 4Q23F. It is early to determine the utilization rate could be reached in 2Q24F, there is a greater...

Patrick Liao

UMC's updated revenue outlook for 1Q24F suggests flat growth compared to 4Q23, with increased demand from Asian clients but bearish sentiment from...

The wafer demand for 1Q24F is expected to be flat, but the ASP is projected to decline. MediaTek's demand is larger while Samsung's is downsized....