NYSE:UMC

Track all markets on TradingView - Prices are not updated in real time
UMC Falls 3.4% Despite Strong Q3 Growth as Heavy Capacity Spending Weighs on Shares

United Microelectronics (NYSE: UMC) shares fell about 3.4% even after the company reported strong third-quarter 2026 revenue growth, higher utilization and record contribution from its 22nm business.

Revenue rose 25.6% year over year and 8.0% sequentially to NT$74.24 billion, or about $2.32 billion. Net income attributable to shareholders reached NT$16.43 billion, while gross margin was 34.0% and operating margin was 25.1%.

Operating conditions improved meaningfully. Wafer shipments increased 7.3% sequentially to a record level, while fab utilization reached 92%. Revenue from 22/28nm technologies accounted for 35% of wafer sales, with 22nm alone reaching a record 18.3%.

Management said demand remained healthy across all major markets and expects fourth-quarter shipments and utilization to remain stable. Advanced packaging and silicon photonics are also expected to contribute increasing revenue as new projects ramp.

However, UMC also announced an additional capital expenditure budget of about $3.2 billion to accelerate capacity expansion in Singapore and Tainan. The spending is intended to address rising customer demand and capacity constraints.

The 3.4% decline appears to reflect investor concern over the scale of the new capital spending and its near-term impact on cash flow and returns, which outweighed otherwise strong revenue growth, utilization and demand trends.
💬
Author
WS Investor 10-28-26