United Microelectronics (UMC) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached NT$60.49 billion, up 6.5% sequentially and 6.0% year-over-year, with wafer shipments up 7.8% and record specialty portfolio revenue at 53.1% of sales.

• Net income attributable to shareholders was NT$14.47 billion, a 5.0% increase from Q2 but a 9.4% decrease year-over-year; EPS was NT$1.16.

• Technology investment remains a priority, with new solutions, collaborations, and a progressing partnership with Intel; Singapore fab extension is nearing completion.

• 22/28nm shipments hit a record high, accounting for 35% of wafer revenue.

• Specialty technology solutions revenue reached an all-time high, representing 53.1% of total sales.

Financial highlights

• Q3 2024 consolidated revenue was NT$60.5 billion, up 6.5% sequentially; gross margin was 33.8%, down from 35.2% in Q2.

• Net income for the first nine months of 2024 was NT$38.7 billion, with cumulative revenue of NT$171.9 billion, up 2.6% year-over-year.

• Cash and cash equivalents stood at NT$103.4 billion as of September 30, 2024.

• Operating income for Q3 2024 was NT$14.10 billion, up 1.5% sequentially.

• Basic EPS for the nine months was NT$3.12.

Outlook and guidance

• Q4 2024 wafer shipments and ASP in USD expected to remain flat; NT dollar appreciation may reduce reported revenue.

• Gross margin for Q4 guided to around 30% due to lower utilization (high 60% range), currency headwinds, and higher depreciation.

• 2024 CAPEX budget set at US$3.0 billion, with 95% allocated to 12" capacity.

• For 2025, wafer shipments expected to increase, but customer forecasts remain conservative.

• Pricing resilience expected to persist, with a one-off pricing adjustment likely in early 2025.