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UMC Gains Analyst Support as Capacity Utilization Approaches 90%
Electronic Technology · Semiconductors · economic_daily · 2026-09-11
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UMC sees improved order visibility through year-end as capacity utilization nears 90%, prompting analysts to maintain a positive outlook on the stock.
What Happened
Capacity Utilization Surge: UMC is witnessing a robust recovery in capacity utilization, which is currently approaching the 90% threshold. Order visibility from clients has extended significantly, now reaching through the end of the year.
Profitability Outlook: Analysts suggest that sustained high capacity utilization will positively influence pricing trends by 2027. Furthermore, every 1% increase in average selling price (ASP) is expected to boost gross margins by approximately 0.5 to 0.6 percentage points.
Silicon Photonics Expansion: The company is currently establishing dedicated 12-inch silicon photonics capacity in Singapore, with the new facility expected to be operational in about 14 months. This strategic move is viewed as a key structural growth driver for the firm.
Advanced Packaging Focus: Beyond photonics, UMC is doubling down on advanced packaging technologies, including interposers, wafer-to-wafer bonding, and hybrid bonding. These capabilities are set to serve as the company's third major pillar of long-term structural growth.