United Microelectronics Q4 Revenue Beats Expectations but Profit Slightly Misses; Q1 Guidance Turns Cautious

Semiconductor foundry giant United Microelectronics reported its fourth-quarter 2025 financial results. The earnings report revealed that the company's revenue reached $1.97 billion, a 2.4% year-over-year increase, surpassing market expectations by $60 million; however, GAAP earnings per share came in at $0.129, slightly missing the consensus estimate by $0.01.

United Microelectronics shares sank 9.5% in premarket trading.

Key financial and operational metrics indicated a period of structural adjustment. Regarding profitability, the fourth-quarter gross margin was 30.7%, while the operating profit margin stood at 19.8%.

In terms of technology node contribution, revenue from the 22/28 nanometer process nodes accounted for 36% of the total.

On capacity and efficiency, UMC's quarterly wafer shipments saw a slight sequential decrease of 0.6% to 994,000 12-inch equivalent wafers. Total capacity was 1.305 million wafers, with the overall capacity utilization rate holding steady at 78%.

The company generated NT$33 billion in cash flow from operating activities during the fourth quarter, and its cash and cash equivalents increased to NT$110.66 billion.

Days sales outstanding improved, decreasing by 3 days to 47 days, while inventory days increased by 1 day to 77 days.

Total capacity for the fourth quarter was 1.305 million 12-inch equivalent wafers. Due to scheduled annual maintenance at its 8-inch and 12-inch fabs, total capacity for the first quarter of 2026 is projected to decrease slightly to 1.283 million 12-inch equivalent wafers.

Regarding capital expenditure and capacity planning, the company's fourth-quarter capital expenditure was $501 million, bringing the full-year 2025 capital expenditure to $1.6 billion. The cash capital expenditure budget for 2026 has been set at $1.5 billion.

First-quarter performance guidance has taken a cautious turn. Wafer shipments are anticipated to remain flat, while the average selling price (in US dollars) is expected to hold firm. The gross margin is forecast to retreat to the high-20% range, and the capacity utilization rate is projected to be in the mid-70% range.