United Microelectronics Corp (UMC, 聯電), the nation’s No. 2 contract chipmaker, yesterday posted its best quarterly net profit in seven quarters after booking a one-time license fee from Fujitsu Ltd.
Net income last quarter surged 56.5 percent to NT$4.56 billion (US$146.11 million) from NT$2.92 billion in the third quarter. Gross margin improved to 27.4 percent last quarter from 21.5 percent in the previous quarter, boosted by Fujitsu’s license fee.
The quarterly figures beat the expectations of Daiwa Capital Markets analyst Rick Hsu (徐稦成), who forecast UMC’s net profit would rise to NT$3.17 billion, and a consensus by other analysts of NT$3.05 billion.
UMC CEO Yen Bo-wen (顏博文) attributed the chipmaker’s strong profitability last quarter to a double-digit percentage growth in 28-nanometer chip shipments.
UMC said advanced 28-nanometer chips accounted for 7 percent of its total revenue of NT$37.24 billion last quarter.
However, total net profit for last year shrank 3.9 percent to NT$12.14 billion, from NT$12.63 billion in 2013.
UMC said it plans to increase capital spending on new equipment this year to US$1.8 billion, from last year’s US$1.4 billion, to hit its highest level since 2010. The spending is to mostly be on expanding advanced 28-nanometer chip production to about 30,000 12-inch wafers per month by the end of this year.
This quarter, UMC expects foundry wafer shipments to grow between 2 percent and 3 percent from last quarter, while average selling price is expected to increase by about 3 percent.
That indicates UMC is to report sequential growth in revenue this quarter, bucking the downtrend in the seasonally slow first quarter.
Daiwa’s Hsu predicted before the investor conference that UMC’s revenue would contract about 5.56 percent.
Gross margin is expected to fall into the mid-20 percent range this quarter, UMC said.
UMC also said revenue from its solar business is expected to be about NT$2 billion, with operating losses of NT$170 million in the current quarter.
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