United Microelectronics Corp (2303) Earnings Report: Feb. Sales Increase to NT$17.45B, a 3.1% Y/Y Growth

United Microelectronics Corp on Smartkarma

According to recent analyst coverage on Smartkarma, an independent investment research network, United Microelectronics Corp (UMC) may see a decrease in their 1Q24F guidance, but there is potential for a steady performance. This is due to their production in Intel’s Fab, which is set for 2027F and currently focused on 22/28nm production. However, UMC’s Asian clients, such as Mediatek Inc and Novatek Microelectronics Corp, are showing increased demand for 1Q24F. On the other hand, European and American clients are more bearish in their outlook. UMC and Intel are also currently discussing the allocation issue of 12nm capacity.

Another report by analyst Andrew Lu highlights UMC’s collaboration with Intel for customers to use UMC’s tsmc-like 12nm design rule to produce products such as WiFi 7 and TV controllers. Intel will provide nearly 30k/m 12″ capacity for UMC at the first stage. However, discussions are ongoing regarding the operation of the fabs, sharing of sales and profits, mass production time, and the potential impact on TSMC.

In a recent update, UMC’s updated revenue outlook for 1Q24F suggests flat growth compared to the previous quarter, with increased demand from Asian clients. However, European and American clients have a more bearish sentiment. The wafer demand outlook for 1Q24F is expected to be flat, but the average selling price (ASP) is projected to decline. Discussions between UMC and Intel regarding the allocation issue of 12nm capacity are ongoing.

Unfortunately, UMC’s recent financial results have not been positive, with a decrease in revenues and net income compared to the previous year. Utilization levels are also expected to decline in the upcoming quarter, the lowest since the downturn began. This is due to weakness in the automotive sector, which has prolonged the overall downturn for UMC.

A look at United Microelectronics Corp Smart Scores

Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma

According to Smartkarma Smart Scores, the long-term outlook for United Microelectronics Corp is looking positive. The company has received a score of 4 out of 5 for value, indicating that it is currently undervalued and has potential for growth in the future. Additionally, it has received a perfect score of 5 for its dividend, which means that the company is performing well in terms of distributing profits to its shareholders.

United Microelectronics Corp also scored a 4 for growth, which suggests that the company is expected to experience steady growth in the long run. This is further supported by its score of 4 for resilience, indicating that it has a strong financial position and is able to withstand any potential challenges or market fluctuations. However, the company received a lower score of 2 for momentum, indicating that it may not be performing as well in the short term.

Overall, based on the information provided by Smartkarma Smart Scores, United Microelectronics Corp appears to be a solid company with potential for long-term growth and good returns for its shareholders. With a diverse range of products, including consumer electronics, memory chips, and communication devices, the company is well-positioned in the market and has the potential to continue its success in the future.

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