3Q22 operating income doubles YoY; 22/28 revenue contribution reaches 25%

Third Quarter 2022 Overview¹:

• Revenue: NT$75.39 billion (US$2.38 billion)
• Gross margin: 47.3%; Operating margin: 40.0%
• Revenue from 22/28nm: 25%
• Capacity utilization rate: 100%+
• Net income attributable to shareholders of the parent: NT$27 billion (US$851 million)
• Earnings per share: NT$2.19; earnings per ADS: US$0.345

TAIPEI, Taiwan — (BUSINESS WIRE) — October 26, 2022 — United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced its consolidated operating results for the third quarter of 2022.

Third quarter consolidated revenue was NT$75.39 billion, increasing 4.6% QoQ from NT$72.06 billion in 2Q22. Compared to a year ago, 3Q22 revenue grew 34.9% YoY from NT$55.91 billion in 3Q21. Consolidated gross margin for 3Q22 reached 47.3%. Net income attributable to the shareholders of the parent was NT$27 billion, with earnings per ordinary share of NT$2.19.

Jason Wang, co-president of UMC, said, “In the third quarter, our results benefited from product mix optimization and a more favorable exchange rate, while fab capacity remained fully utilized. Despite softening demand in consumer end markets, strengths in certain wireless communications areas drove further expansion in our 22/28nm business, which accounted for 25% of overall third-quarter revenue and lifted wafer average selling price. We believe our industry-leading position in OLED display driver ICs will continue to drive growth for our 22/28nm technologies amid growing adoption of OLED panels in smartphones and other end devices. We also saw sustained momentum in our automotive business during the quarter, and we intend to pursue more collaboration opportunities with existing and potential automotive customers.”

Co-president Wang said, “Moving into the fourth quarter, we expect to face headwinds amid demand weakness, impacted by factors including the inflationary environment and Ukraine war. While UMC will not be immune to the inventory correction affecting the industry, we will work closely with our customers as they adjust to current market conditions. At the same time, we will continue to deliver differentiated technology processes to enable customers’ product pipelines. We have revised the company’s 2022 capital expenditure down to US$3 billion, but our capacity expansions in Tainan and Singapore are still progressing as planned in order to meet long-term supply commitments. Despite near-term turbulences, the structural story of increasing silicon content driven by the rise of 5G, AIoT, and EV remains intact. With our comprehensive technology offering, focus on manufacturing excellence, and resilient financial structure, UMC will further increase our exposure to strong growth markets and consolidate our specialty technology leadership.”

Co-president Wang added, “In terms of corporate sustainability, UMC made steady progress towards our goals across all three areas of ESG. Going into 2023, we will accelerate carbon emissions reduction efforts by proactively seeking ways to lower emissions associated with wafer manufacturing and products footprint, working with partners to address emissions from the value chain, as well as investing in net-zero technologies as we strive for net zero by 2050.”

Summary of Operating Results