Start here if you're new
what it is
UMC manufactures chips for other companies, mainly on older process technologies that still run cars, displays, and industrial gear.
how it gets paid
FY2025 consolidated revenue was about NT$237.55B (~US$7.6B at rough FX), up a few percent in TWD terms—wafer sales remain the majority of the mix (use the geometry tables in the release for the exact split).
what just happened
Q4 2025: revenue NT$61.81B (US$1.97B), gross margin 30.7%, operating margin 19.8%, EPS US$0.129 per ADS (NT$0.81 per share) per the Jan 28, 2026 results statement.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
45/100 earnings predictability — expect surprises
15.7x trailing p/e — the market's not buying it — or you found a deal
5.2% dividend yield — cash in your pocket every quarter
19.8% Q4 2025 operating margin (company release)
xvary composite: 67/100 — average
What they do
UMC manufactures chips for other companies, mainly on older process technologies that still run cars, displays, and industrial gear.
UMC wins because chip fabs are brutally expensive to build, and customers hate moving production once yields work. Switching foundries means redoing designs and risking delays, so what: your supplier gets sticky. Margins are real but cyclical—Q4 2025 operating margin was 19.8% on 30.7% gross margin, not a 40%+ operating story.
How they make money
~US$7.6B
FY2025 consolidated revenue (≈ NT$237.55B; USD is FX-sensitive)
wafer fabrication
~$6.1B
illustrative
assembly and testing
~$0.68B
illustrative
circuit design services
~$0.46B
illustrative
mask tooling
~$0.30B
illustrative
The products that matter
advanced mature-node manufacturing
22nm Technology Platform
30%+ growth in Q4 2025
this platform grew more than 30% in Q4 2025 and management called it the major growth driver for 2026. if that ramp slows, the growth story gets thinner fast.
2026 driver
embedded HV and non-volatile memory
Specialty Technologies
supports 30.7% gross margin
these specialty nodes are tied to demand in power management and edge AI. the data is light on segment revenue, but they are part of the mix shift management needs to defend a 30.7% gross margin.
mix matters
Key numbers
19.8%
Q4 2025 operating margin
Operating margin → money left after running the fabs → so what: this is the filing-stated Q4 2025 level, not a heroic 40%+ headline.
NT$3.34
FY2025 EPS (ordinary)
The company’s FY2025 results overview cites NT$3.34 EPS for the year—compare to ADS math separately (5 ordinary shares per ADS).
5.2%
dividend yield
Dividend yield → cash paid back to shareholders each year at today's price → so what: you get paid to wait, but only if the stock holds up.
$8
street target (verify)
Some third-party screens still show ~$8–$8.60 targets—treat as stale until you confirm your broker’s timestamp; the ADR price can diverge from Taiwan listing moves.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 45 / 100
- long-term debt $1.4B (6% of capital)
- net profit margin 33.5% — keeps 34 cents of every dollar in revenue
- return on equity 24% — $0.24 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in UMC 3 years ago → it's now worth $13,370.
The index would have given you $14,540.
source: institutional data · total return
What just happened
results posted
Q4 2025 revenue NT$61.81B (US$1.97B); EPS US$0.129/ADS (NT$0.81/share).
Consolidated gross margin was 30.7%; operating margin 19.8%. Net income attributable to shareholders was NT$10.06B (US$320M). Sequentially, net income fell sharply vs. Q3—non-operating items and mix matter.
US$0.129
Q4 EPS per ADS
30.7%
gross margin
19.8%
operating margin
the number that mattered
Mix: 22/28nm was 36% of wafer revenue; 22nm revenue rose >30% quarter-on-quarter to a record per the release—this is the operational lever bulls care about.
-
united microelectronics stock has been a star performer.
-
at time of this writing, these shares have catapulted nearly 25% thus far in 2026, handily outpacing the broader s&p 500 index.we attribute this to the company’s strong earnings performance in recent times, coupled with a generally positive outlook for the future. we look for the company’s earnings to advance at a healthy annual rate over the next couple of years, assuming the economy holds up.
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there are a few key factors that underpin our profit-growth assumptions over the next two years.for one, united micro should capitalize on strong demand for specialized nodes, including embedded high voltage, and nonvolatile memory, among others.
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furthermore, the expansion of 22 nanometer (nm) technology ought to continue to be a major revenue driver, with strong double-digit gains likely in the quarters ahead. (it should be noted that comparisons for 22 nm products increased more than 30% in the final period of 2025.) a mix shift toward higher-margined products is also a positive for the 12 to 18 months ahead.
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finally, while umc focuses on mature nodes, it is positioned to benefit from the continued ai surge, specifically in power management, networking, and silicon photonics, which require specialized mature technologies.however, geopolitical concerns, namely the war in iran, is a factor that bears watching in the months ahead, as it could well alter the global economic landscape. we forecast that earnings will climb at a low-double-digit annual rate, on average, over the 3to 5-years ahead. umc has a strong niche presence in the semiconductor fab industry, which ought to serve it well over the long run, assuming economic conditions hold up.
United Microelectronics Q4 2025 results (Jan 28, 2026) · Business Wire · SEC ADR filings (UMC)
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What could go wrong
the #1 risk here is volatility in foundry profits even when wafer revenue looks stable. Q4 net income fell sharply vs. Q3 on a sequential basis while revenue rose—check non-operating gains/losses and tax lines, not just wafer ASPs.
med
margin compression
Q4 2025 gross margin was 30.7%, but profit still fell 33% despite revenue rising to $1.97B. That is what a squeeze looks like in plain English.
If this repeats, 15.7x earnings stops looking cheap because the earnings denominator is shrinking.
med
the street is not fully buying the story
Consensus carries a Hold rating and a price target of $8.60 versus a current price of $9.73.
That is roughly a 12% downside gap. You are paying ahead of where analysts think fair value sits today.
med
crowding in mature and specialty nodes
UMC's niche is mature-node and specialty manufacturing, not leading-edge process leadership. If competitors add supply or match pricing, that 30.7% gross margin advantage gets harder to defend.
This would hit the exact part of the thesis doing the heavy lifting: mix improvement and specialty-node profitability.
A margin miss matters more than a revenue beat here because the last quarter already proved sales can rise while profits fall hard.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings
Q1 2026 earnings report
Expected April 22, 2026. The bigger question is whether 22nm mix gains show up as durable operating income—not just one quarter of FX or non-operating help.
margin
gross margin around 30.7%
This is the number to track. If revenue grows and gross margin still slips, the recovery story gets weaker, not stronger.
growth
22nm platform ramp
Management called 22nm the major 2026 driver after 30%+ growth in Q4 2025. You want to see that pace stay convincingly positive.
macro + geopolitics
demand and geopolitical stress
The company itself flagged geopolitical concerns. In a Taiwan-based foundry, that is not background noise.
Analyst rankings
earnings predictability
45 / 100
Earnings can move around more than you want. In human-speak: do not treat this like a smooth compounding machine.
street stance
hold
Analysts are not pounding the table here. Current price is $9.73 versus a consensus target of $8.60.
source: institutional data
Institutional activity
institutions have been net buying for 2 consecutive quarters — 125 buyers vs. 59 sellers in 4q2025. total institutional holdings: 0.1B shares. net buying for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$4
$12
$10
current price
$8
target midpoint · 18% from current · 3-5yr high: $18 (+85% · 21% ann'l return)
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