United Microelectronics Corp. (UMC) announced on Wednesday that it was boosted by strong wafer shipment growth, and net profit rose 46% in the fourth quarter of last year. However, the company stated that the uncertainties in the U.S. and emerging market economies may have led to a suppression of chip demand this year.
In the three months ended December 31 last year, UMC’s net profit was NT$6.42 billion (US$219 million), compared to NT$4.4 billion in the same period of last year. The quarterly profit was slightly higher than the average of NT$6.44 billion estimated by the eight analysts surveyed. Seasonal revenue increased by 13% from NT$27.75 billion in the same period last year to NT$31.32 billion.
Sun Shiwei, Chief Executive Officer of UMC, said at the investor meeting after the company announced its performance report that after more than a year and a half of growth, the company expects to be appreciated by the new Taiwan dollar against the US dollar, some customers’ products and technology conversion, etc. Affected by factors, revenue in the first quarter of 2011 will decline slightly from the previous quarter.
He said that customer technology upgrades will affect the company’s product structure and put pressure on current quarterly revenues.
He also said that chip demand for tablet PCs and smart phones will drive the company's earnings growth this year, but it expects wafer shipments in the first quarter will fall 1%-4% from the previous quarter. In the fourth quarter of last year, the company’s shipment of eight-inch equivalent wafers was 1.13 million, down from 1.2 million in the third quarter.
UMC said that in the fourth quarter of last year, the company's gross profit margin fell to 32.1% from 32.6% in the third quarter. The company said it expects gross margin to exceed 25% in the first quarter of this year, and the average selling price will fall by 1%-7% from the previous quarter. However, the company did not disclose the average selling price in the fourth quarter of last year.
Sun Shiwei said that the company’s capital expenditure plan for this year is US$1.8 billion, which is in line with the previous year's level. It will be used to expand the production of 40-nanometer process products and transition to more advanced 28-nanometer process technology.
He said that the 40-nanometer chip will become the company's main driver of revenue this year, and the proportion of this type of chip business revenue to total revenue is expected to increase from 5% last year to 10% in the second half of this year.
In the three months ended December 31, UMC’s operating rate was 94%, which was lower than the level of over 99% in the previous quarter. The company said it expects the operating rate will drop to around 90% in the first quarter of this year.
In the three months ended December 31 last year, UMC’s net profit was NT$6.42 billion (US$219 million), compared to NT$4.4 billion in the same period of last year. The quarterly profit was slightly higher than the average of NT$6.44 billion estimated by the eight analysts surveyed. Seasonal revenue increased by 13% from NT$27.75 billion in the same period last year to NT$31.32 billion.
Sun Shiwei, Chief Executive Officer of UMC, said at the investor meeting after the company announced its performance report that after more than a year and a half of growth, the company expects to be appreciated by the new Taiwan dollar against the US dollar, some customers’ products and technology conversion, etc. Affected by factors, revenue in the first quarter of 2011 will decline slightly from the previous quarter.
He said that customer technology upgrades will affect the company’s product structure and put pressure on current quarterly revenues.
He also said that chip demand for tablet PCs and smart phones will drive the company's earnings growth this year, but it expects wafer shipments in the first quarter will fall 1%-4% from the previous quarter. In the fourth quarter of last year, the company’s shipment of eight-inch equivalent wafers was 1.13 million, down from 1.2 million in the third quarter.
UMC said that in the fourth quarter of last year, the company's gross profit margin fell to 32.1% from 32.6% in the third quarter. The company said it expects gross margin to exceed 25% in the first quarter of this year, and the average selling price will fall by 1%-7% from the previous quarter. However, the company did not disclose the average selling price in the fourth quarter of last year.
Sun Shiwei said that the company’s capital expenditure plan for this year is US$1.8 billion, which is in line with the previous year's level. It will be used to expand the production of 40-nanometer process products and transition to more advanced 28-nanometer process technology.
He said that the 40-nanometer chip will become the company's main driver of revenue this year, and the proportion of this type of chip business revenue to total revenue is expected to increase from 5% last year to 10% in the second half of this year.
In the three months ended December 31, UMC’s operating rate was 94%, which was lower than the level of over 99% in the previous quarter. The company said it expects the operating rate will drop to around 90% in the first quarter of this year.