United Microelectronics (NYSE: UMC) reported Q3 EPS of $0.13, $0.06 better than the analyst estimate of $0.07. Revenue for the quarter came in at $1.54 billion versus the consensus estimate of $1.49 billion.

Third Quarter 2020 Overview1:

• Revenue: NT$44.87 billion (US$1.54 billion)
• Gross margin: 21.8%; Operating margin: 15.9%
• Revenue from 28nm: 14%
• Capacity utilization rate: 97%
• Net income attributable to stockholders of the parent: NT$9.11 billion (US$313 million)
• Earnings per share: NT$0.75; earnings per ADS: US$0.129

Jason Wang, co-president of UMC, said, “During the third quarter, consolidated operating margin reached 15.9%, while utilization rate remained firm at 97%. Wafer shipments reached 2.25 million 8-inch equivalent wafers. During Q3, work-from-home and home schooling trends continued to contribute to stable end market demand for applications in wireless connectivity, power management ICs used in smartphones as well as high speed interface I/O controllers found in computing devices. In addition to demand stability across various end markets, our 28nm revenue grew QoQ as customer product tape outs continued throughout the quarter. Moving forward, we expect to see a sustained increase in the number of 28nm tape outs, which will further diversify our 28nm exposure to end markets and customers.”

Co-president Wang continued, “Looking into the fourth quarter, demand from consumer and computer related applications will lead to a minor increase in wafer shipments, propelled by ongoing work-from-home initiatives and home schooling. Furthermore, we have seen an uptick in semiconductor demand due to more silicon content in particular applications such as newly deployed 5G smartphones, IoT devices and other consumer products. Therefore, the current industry landscape appears to show favorable supply and demand dynamics towards foundry; hence, UMC will pursue a delicate balance in strengthening our customer relationships while securing interests for our shareholders to ensure our long term growth.”

Fourth Quarter 2020 Outlook & Guidance

Quarter-over-Quarter Guidance:

• Wafer Shipments: To increase by 1-2%
• ASP in USD: To increase by 1%
• Gross Profit Margin: To remain flat
• Capacity Utilization: mid-90% range
• 2020 CAPEX: US$1 billion

For earnings history and earnings-related data on United Microelectronics (UMC) click here.