United Microelectronics Corporation (UMC) reported fourth‑quarter 2025 results that surpassed revenue expectations but fell short of earnings estimates. Consolidated revenue reached NT$61.81 billion, a 4.5 % sequential increase and a 2.4 % year‑over‑year rise, beating the consensus of NT$59.71 billion. Gross margin expanded to 30.7 % from 29.8 % in Q3, while net income attributable to shareholders declined to NT$10.06 billion, a 32.9 % sequential drop, and earnings per ordinary share fell to NT$0.81 (US$0.129 per ADS) versus the consensus of US$0.14 per ADS.
The 22‑nanometer and 28‑nanometer specialty platforms were the primary growth drivers. 22‑nm revenue surged 31 % quarter‑on‑quarter to a record high and accounted for more than 13 % of total Q4 revenue, underscoring the platform’s strong demand from AI, networking, and automotive customers. 28‑nm revenue also contributed significantly, reflecting continued adoption of UMC’s advanced packaging and silicon photonics solutions.
Net income contraction was largely attributable to higher income‑tax expenses, which offset the benefit of margin expansion. Compared with Q3, the company’s net income fell 32.9 % despite a 4.5 % revenue increase, illustrating the impact of tax adjustments on profitability. EPS also slipped to NT$0.81 from NT$1.20 in Q3, a 32.9 % sequential decline, highlighting the sensitivity of earnings to tax and cost factors.
Management guided for a flat wafer‑shipment outlook in Q1 2026, a firm U.S. dollar average selling price, and a high‑20 % gross‑margin range. Capacity utilization was projected to remain in the mid‑70 % range, reflecting a cautious stance amid mild demand across most markets. Co‑president Jason Wang emphasized that the results were in line with guidance and that 2026 would be another growth year driven by accelerating tape‑outs on 22‑nm platforms and expanding advanced‑packaging capabilities.
Investors reacted negatively to the earnings miss, focusing on the shortfall in EPS despite the revenue beat. The market’s emphasis on profitability over revenue growth signals heightened sensitivity to tax and cost pressures, even as UMC’s specialty platforms continue to drive top‑line momentum.
Strategically, UMC is investing in a Circular Economy and Recycling Innovation Center and maintaining a 2026 capital‑expenditure budget of US$1.5 billion, slightly lower than the previous year. These moves reinforce the company’s commitment to sustainability and long‑term growth while balancing the need for disciplined capital deployment.
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