UMC Misses Q3 Estimates as Budget Smartphone Demand Softens; Board Adds $3.2B Capex
UMC has more than doubled off its 52-week low of $6.97.
Summary
UMC's Q3 revenue of $2.32 billion and EPS of 21 cents per ADS both came in below consensus ($2.35 billion and 23 cents), and the stock slipped in premarket. The quarter itself was operationally strong — gross margin expanded to 34% from 29.8%, utilization hit 92%, and wafer shipments set a record above 1.2 million 12-inch-equivalent wafers. The miss is a demand-mix story: the CEO flagged weaker mid- and low-end smartphone demand, though he said UMC's exposure there is limited. Management guided Q4 wafer shipments up low-single-digits with stable ASPs and gross margin comparable to Q3, and expects 2027 blended ASP to rise at least 10% as growth shifts from volume to pricing and richer mix. The board approved an additional $3.2 billion in capex for Singapore and Tainan, on top of the reiterated $2 billion 2026 plan, with the next expansion phase starting late 2028. Watch the Q4 gross margin line — management warned rising raw material costs and depreciation could keep margins below prior peaks.
At the time of this announcement, UMC was trading at $19.36 on NYSE in the Technology sector, with a market capitalization of approximately $47.3B. The 52-week trading range was $6.97 to $28.96. This news item was assessed with negative market sentiment and an importance score of 7 out of 10. Source: Benzinga.