United Microelectronics Stock Falls To Over 2-Year Low After Mixed Results, But Retail Turns Extremely Bullish

UMC is betting on capacity expansion and innovation to drive its growth in the future, including catering to the demand for artificial intelligence-optimized chips.

Shares of United Microelectronics Corp. (UMC) declined nearly 5% in morning trade on Tuesday, tumbling to a two-year low after the company posted mixed fourth-quarter results.

UMC reported revenue of $1.84 billion in the fourth quarter, rising 9.9% year-on-year. Its net income stood at $259 million, declining from $402 million a year ago.

UMC’s earnings per American Depository Share (ADS) also fell during the fourth quarter to $0.104 from $0.162 a year ago.

The company is betting on capacity expansion and innovation to drive its growth in the future, including catering to the demand for artificial intelligence-optimized chips.

“Our new Singapore Phase 3 fab will enhance customers’ supply chain resilience, while the 12nm collaboration with our U.S. partner will offer customers a migration path beyond 22nm,” said Jason Wang, co-president of UMC.

UMC and Intel Corp. (INTC) announced partnership in January 2024 to develop a 12-nanometer semiconductor process, aimed for use in mobiles, communication infrastructure, and networking.

Retail sentiment on Stocktwits was upbeat despite the mixed results, entering the ‘extremely bullish’ (86/100) territory from ‘neutral’ (46/100) a day ago. Message volume also rose significantly to enter the ‘extremely high’ (85/100) zone.

Investors sounded a positive note for the UMC stock, with one user saying it is a bigger deal than Intel.

Tuesday’s dip notwithstanding, one user has a price target of $9 for the UMC stock.

UMC's share price has been on the decline of late – it has fallen nearly 25% over the past six months, while its one-year performance is worse with a decline of nearly 27%.

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