United Microelectronics Corp (UMC, 聯電), the world’s second-largest contract chipmaker by revenue, said yesterday it had posted its highest quarterly profit in six years on strong wafer shipments.
Third-quarter net income rose 43 percent to NT$8.72 billion (US$283 million), from NT$6.1 billion a year earlier and grew 26.7 percent on a quarterly basis from NT$5.27 billion, the company said at an investors’ conference in Taipei.
The Hsinchu-based company posted an earnings per share of NT$0.70 in the third quarter, up from NT$0.42 in the second quarter.
“Factories were running at full capacity in the third quarter, with shipments hitting a record high of more than1.2 million eight-inch wafers,” CEO Sun Shih-wei (孫世偉) told investors, adding that last quarter’s revenues were the highest in six years.
Revenues were NT$32.65 billion in the third quarter, up 19.1 percent from NT$27.41 billion recorded in the same period of last year. That also represented a 9.8 percent gain quarter-on-quarter from NT$29.75 billion.
UMC said its gross margin increased to 32.6 percent in the third quarter from 29.6 percent in the second quarter, that it expected its fourth-quarter gross margin to remain in the low 30 percent range and that its average selling price [ASP] was likely to continue to rise.
UMC’s capacity utilization rate was more than 99 percent in the third quarter, compared with the 100 percent in the previous three months. The company forecast that its utilization rate would continue to slide to the mid-to-low 90 percent range next quarter.
“Our utilization rate will drop in the fourth quarter because of seasonal weakness. ASP will probably continue to rise as we improve our product mix, although our revenue will also be slightly hit by the volatility of the local currency and other seasonal factors,” Sun said.
He predicted that revenue for the current quarter would fall by 5 percent from the third quarter because of the strengthening NT dollar against the US dollar.
He said he was optimistic, but cautious about the foundry market in the fourth quarter.
UMC said that it expected wafer shipments to fall by a “mid-single-digit” percentage this quarter after the third quarter posted record high shipments and that it expected ASP to rise 5 percent quarter-on-quarter.
“Revenue growth for the global semiconductor industry will return to normal, about 5 percent to 10 percent next year, though the foundry’s revenue growth will outpace the industry, which is likely to rise between 10 percent and 15 percent next year,” Sun said.
However, it’s still too early to give forecasts for the first quarter of next year because multiple uncertainties are lingering around the global economy, including China’s tightening measures and the US’ second wave of quantitative easing stimulus, he said
UMC shares dropped 0.05 percent to NT$13.8 yesterday, while the benchmark TAIEX edged 0.62 percent lower, Taipei Stock Exchange data showed.
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