United Microelectronics (UMC) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached NT$57.86 billion (US$1.74B), up 5.9% year-over-year but down 4.2% sequentially; net income was NT$7.78 billion, with EPS at NT$0.62.

• Gross margin was 26.7%, down from 30.9% in Q1 2024, reflecting margin compression and higher costs.

• Net income declined 25.6% year-over-year due to lower ASP and operating income.

• 22/28nm revenue hit a record, making up 37% of total sales, driven by a 46% QoQ surge in 22nm demand.

• Board proposed a cash dividend of NT$2.85 per share, pending shareholder approval.

Financial highlights

• Operating income for Q1 2025 was NT$9.79 billion (16.9% margin), down 18.2% QoQ and 16.1% YoY.

• Cash and cash equivalents stood at NT$106.35 billion as of March 31, 2025; total equity at NT$390.83 billion.

• Non-operating loss of NT$439 million from investment valuation; net non-operating expenses were NT$0.44B.

• Free cash flow in Q1 2025 was NT$9.26 billion.

• Debt to equity ratio improved to 47% from 51% in the prior quarter.

Outlook and guidance

• Q2 2025 wafer shipments expected to increase 5%-7% sequentially; ASP in USD to remain flat.

• Gross margin projected to recover to ~30%; capacity utilization to mid-70% range.

• 2025 CAPEX budget set at US$1.8B, with 90% allocated to 12" capacity.

• Moderate rebound in demand expected in Q2, but management remains cautious due to macro and policy uncertainties.

• Full-year 2025 addressable market expected to grow low single digits; company aims to outgrow the market.