Co-general manager Wang Shi told a conference on 30 July that while volumes are inching up, the classic peak season effect is nowhere to be seen.
Quarterly growth is expected to remain stuck in single-digit territory, which hardly counts as festive. The capacity utilisation rate sits at around 75 per cent, and wafer shipments are forecast to climb a tepid 1 to 3 per cent.
Even if average selling prices stay steady in US dollars, UMC is staring down the barrel of forex pain. Every one per cent appreciation in the New Taiwan dollar slices one per cent off revenue, so third-quarter figures are likely to take a hit. Assuming current exchange rates hold, gross margins should cling close to Q2 levels.
Wang said US dollar revenue should still rise, but a toxic cocktail of tariffs, currency swings and murky market visibility is dulling the outlook. The traditional third-quarter sales bounce might be more of a stagger.
Despite Troubled Chipzilla’s recent misadventures, its 12nm process partnership with UMC is still trundling along as planned. Mass production remains on track for 2027. Wang confirmed chip performance verification is underway and that the PDK should land with initial customers by June 2026.
UMC is putting all its eggs in the 12nm basket for now. Wang reiterated there are no clear plans to push below 12nm, though the company will keep expanding its special process line-up and might look deeper depending on how current tie-ups pan out.
Wang added that recent demand recovery in Q2 and Q3 may owe more to panic stocking over tariffs and geopolitical ructions than genuine consumer appetite. That means the usual seasonal rhythm may be skewed.
Even so, UMC is still clinging to its full-year growth prediction for 2025, expecting it to beat the wafer serviceable market's 1 to 3 per cent rise. The 22/28nm process family is expected to do much of the heavy lifting thanks to a steady stream of design wins, and its market share is forecast to grow further through 2026 and 2027.
On the advanced packaging front, UMC is already touting 2.5D interposer solutions for high-performance computing chips, especially in cloud and edge AI. It is also dabbling in 3D wafer stacking and through-silicon vias. These solutions have found homes in 5G RFICs and are being used for memory stacking in high-bandwidth computing.
Capital expenditure for the year stays pinned at $1.8 billion. Depreciation, which had been galloping at 20 per cent year-on-year thanks to a shiny new plant in Singapore, is expected to slow to single-digit growth in 2026, easing the pressure on UMC’s cost structure.