UMC beats Q2 estimates by 255% as silicon photonics drives capex boost

United Microelectronics Corp reported second-quarter earnings per share of $0.54, surpassing the $0.15 consensus by 255%, as capacity utilization climbed to 85% on strengthening demand in communications and consumer segments.

Management said the results reflected a silicon photonics milestone and the broader AI-driven demand cycle, noting that utilization rates improved from the prior quarter as wafer shipments increased.

Revenue came in at $2.18 billion, though the company did not disclose a consensus revenue estimate for comparison. Wafer shipments and utilization both improved quarter over quarter, driven by communications and consumer applications. UMC raised its 2026 capital-expenditure budget to $2 billion, up from prior plans, to fund silicon photonics and advanced-packaging initiatives as well as new fab construction in Singapore and Taiwan. The move mirrors similar capacity expansions by TSMC and Amkor Technology, which have also boosted packaging investment to meet AI chip demand. Amkor last week guided to capital spending of as much as $3 billion for 2026, close to 40% of its revenue, as advanced packaging margins improve. Silicon photonics, which uses light instead of electrical signals to transmit data, has emerged as a critical technology for AI data center interconnects, driving foundry investment across the sector.

The capex increase shows management expects AI demand to sustain the semiconductor supply shortage. Shares slipped 0.75% following the print. Investors will watch the Q3 earnings call for updates on silicon photonics production timelines and fab construction progress.

This article is for informational purposes only and does not constitute investment advice.