United Microelectronics Corporation (NEW)

Welcome everyone to UMC's 2026 Second Quarter Earnings Conference Call. All lines have been placed on mute to prevent background noise. After the presentation, there will be a question and answer session. Please follow the instructions given at that time if you would like to ask the question. For your information, this conference call is now being broadcasted live over the internet. Webcast replay will be available within two hours after the conference is finished. Please visit our website www.umc.com under the Investor Relations, Investors, Events section. Now I would like to introduce Mr. Michael Lin, Head of Investor Relations at UMC. Mr. Lin, please begin.

Thank you and welcome to UMC's conference call for the second quarter of 2026. I am joined by Mr. Jason Wang, the CEO of UMC. and Mr. Chi-Tung Liu, the CFO of UMC. In a moment, we will hear our CFO present the second quarter financial results, followed by our CEO's key message to address UMC's focus on third quarter 2026 guidance. Once our CEO and CFO complete their remarks, there will be a Q&A section. UMC's quarterly financial reports are available at our website. www.umc.com under the Investors' Financials section. During this conference, we may make forward-looking statements based on management's current expectations and beliefs. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially, including the risks that may be beyond the company's control. For more detailed description of this risk and uncertainties, please refer to our recent and subsequent filing with the SEC and ROC security authorities. During this conference, you may view our financial presentation material, which is being broadcast live through the Internet. Now, I would like to introduce UMCCFO, Mr. Chi-Tung Liu. Thank you, Michael.

I'd like to go through the 2Q26 Investor Conference presentation material, which can be downloaded or viewed in real time from our website. Starting on page 4, second quarter of 2026, consolidated revenue was $68.73 billion NT, with gross margin at 32.5%. Net income attributable to the shareholder of the parent was $42.26 billion NT, and earnings per ordinary share was $3.39 NT. Utilization rate in quarter two climbed to 85% from 79% in the previous quarter, and total wafer shipment in the second quarter reached 1.13 million, 12-inch wafer equivalent. On page five, we will start the sequential comparison. Revenue grew 12.6% quarter over quarter to reach $68.7 billion NT. Cost margin rate increased by almost over three percentage basis points to 32.5% or $22.3 billion NT. Because of the recent stock market performance, our investment and dividend income together reached $30 billion in the third quarter under the non-operating income and expenses, which helped our net income to reach $42.2 billion. And for the net income attributable to the shareholder of the parent, is 42.26, or an EPS of 3.39 per shares in the second quarter. On page six, for the first six months of the year, the annual comparison, for the first half, our revenue grew 11.3% year-over-year to $129.77 billion in the first six months of 2026. Gross margin rate also grow by over three percentage basis points to 30.9% or 40.1 billion NT in the first six months of 2026. For the non-operating income, similar for what happened in the second quarter, for the first half of the total non-operating income, Operating income reached $35.6 billion, which leads our net income to reach $58.4 billion in the first six months of the year. EPS was 4.68 in the first half of 2026. On page seven, cash on hand is around $124.7 billion NT. with total equity reached $443.9 billion at the end of the second quarter of 2026. On page 8, our blended ASP increased by a low single-digit percentage in the second quarter of 2026. For revenue breakdown on page 9, Asia remained our largest Thank you very much. and there's almost no change for the revenue among three major segments. For revenue breakdown by technology on page 12, total revenue under 40 nanometer still around 52%, with 22 and 28 nanometer is becoming our largest revenue pool, represent 37% of the total revenue. Our quarterly capacity has shown some increase in our Singapore site 12i for the second quarter, and there will be a more meaningful increase in the coming quarter to reach 192,000 12-inch wafer capacity for our Singapore site. On page 14, our annual TAPAS budget has raised Thank you, Chi-Tung.