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Structural profitability intact despite industry consolidating at the trough
First Quarter 2023 Overview1:
- Revenue: NT$54.2 billion (US$1.78 billion)
- Gross margin: 35.5%; Operating margin: 26.7%
- Revenue from 22/28nm: 26%
- Capacity utilization rate: 70%
- Net income attributable to shareholders of the parent: NT$16.2 billion (US$532 million)
- Earnings per share: NT$1.31; earnings per ADS: US$0.215
United Microelectronics Corporation UMC TWSE: 2303))) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced its consolidated operating results for the first quarter of 2023.
First quarter consolidated revenue was NT$54.2 billion, decreasing 20.1% QoQ from NT$67.8 billion in 4Q22. Compared to a year ago, 1Q23 revenue declined 14.5% YoY from NT$63.4 billion in 1Q22. Consolidated gross margin for 1Q23 was 35.5%. Net income attributable to the shareholders of the parent was NT$16.2 billion, with earnings per ordinary share of NT$1.31.
Jason Wang, co-president of UMC, said, “In the first quarter of 2023, our business was impacted by sluggish wafer demand as customers continued to digest elevated inventory levels. In line with guidance previously provided, wafer shipments fell 17.5% QoQ and utilization rate dropped to 70%, while average selling price stayed firm during the quarter. Factoring in a less favorable foreign exchange rate, revenue in the first quarter fell 20.1% QoQ. Despite lower utilization, gross margin remained firm at 35.5%, reflecting improved structural profitability and optimized product mix. Although demand weakened across major end markets, our automotive and industrial segments posted growth during the quarter. Automotive sales, in particular, accounted for 17% of overall first quarter revenue. While this partially reflects declines in other segments, we expect automotive to remain a significant revenue contributor and key growth driver for UMC going forward, as IC content in cars continue to increase…
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