United Microelectronics Corp (UMC,
The chipmaker will increase capacity at its factories in Singapore and Taiwan that use 12-inch silicon wafers, Jackson Hu (胡國強), chairman and chief executive officer of UMC, said yesterday at a shareholders' meeting in Hsinchu.
"This will help us achieve sustainable growth in the future," Hu said.
UMC forecast in April that factory usage would rise this quarter on demand for semiconductors used in mobile phones. One of the company's main customers, Texas Instruments Inc, the world's biggest cellphone chipmaker, last week raised its earnings projections for the second quarter on rising sales in India and China.
UMC also plans to start mass production using 65-nanometer technology next year, Hu said.
The 65-nanometer factories allow a company to make more chips on each silicon wafer by shrinking chip sizes. A nanometer is a billionth of a meter and measures the distance between transistors in a chip.
"The new technology is aimed at enhancing the company's competitiveness," Hu said.
The company will start producing a small number of 65-nanometer chips for two customers in the second quarter, UMC said on April 26.
Factory capacity is expected to reach about 80 percent this quarter, compared with 79 percent in the first quarter, the company said in its earlier forecast.
The more advanced 12-inch wafers help to cut production costs by doubling the number of chips that can be made from standard 8-inch wafers.
UMC stuck to its earlier forecast that capital spending will rise to US$1 billion this year from US$700 million last year.
Hu said the company would not rule out raising capital expenditure next year.
Texas Instruments' second-quarter sales will be US$3.63 billion to US$3.78 billion, compared with a prior forecast of US$3.46 billion to US$3.75 billion, the Dallas-based company said last Thursday.
At a meeting last June, UMC shareholders passed a resolution backing a decision by Robert Tsao (曹興誠), the chairman at the time, to receive a 15 percent stake in He Jian Technology (Suzhou) Co (和艦) worth US$110 million in compensation for "past assistance" and anticipated cooperation.
Tsao, who resigned in January, was questioned by investigators last June after being fined NT$3 million (US$92,100) by the Financial Supervisory Commission for breaching securities laws through late disclosure of information about the company's relations with He Jian. Tsao was retained as a senior adviser for the company.
Hu said yesterday that the firm hadn't yet received guidance from the Investment Commission of the Ministry of Economic Affairs regarding how to transfer He Jian's stake to the company after it wrote to the commission seeking assistance in March last year.
"He Jian is helping to put that 15 percent stake in a trust in order to protect our rights and benefits as the Chinese company's shareholder," Hu said.
UMC's larger rival Taiwan Semiconductor Manufacturing Co (
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