United Microelectronics Corp (UMC) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

July 26, 2023 5:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Welcome, everyone, to UMC's 2023 Second Quarter Earnings Conference Call. [Operator Instructions]. For your information, this conference call is now being broadcasted live over the Internet. Webcast replay will be available within an hour after the conference is finished. Please visit our website, www.umc.com, under the Investor Relations, Investors, Events section.

Now I would like to introduce Mr. Michael Lin, Head of Investor Relations at UMC. Mr. Lin, please begin.

Michael Lin

Thank you, and welcome to UMC's conference call for the second quarter of 2023. I'm joined by Mr. Jason Wang, the President of UMC; and Mr. Chi-Tung Liu, the CFO of UMC. In a moment, we will hear our CFO present the second quarter financial results followed by our President's key message to address UMC's focus and third quarter 2023 guidance. Once our President and CFO complete their remarks, there will be a Q&A section. UMC's quarterly financial reports are available at our website, www.umc.com, under the Investors Financial section.

During this conference, we may make forward-looking statements based on management's current expectations and beliefs. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially, including the risk that may be beyond the company's control. For a more detailed description of these risks and uncertainties, please refer to our recent and subsequent filings with the SEC and the ROC security authorities.

During this conference, you may view our financial presentation material, which is being broadcast live through the Internet.

Now I would like to introduce UMC's CFO, Mr. Chi-Tung Liu, to discuss UMC's first quarter 2023 financial results.

Chi-Tung Liu

Thank you, Michael. I'd like to go through the 2Q, 23 investor conference presentation material which can be downloaded or viewed in real time from our website.

Starting on page 4. The second quarter of 2023 consolidated revenue was TWD56.3 billion with a gross margin at around 36%. The net income attributable to the stockholder of the parent was TWD15.6 billion and earnings per ordinary shares were TWD1.27. In the second quarter of 2023 the utilization rate was 71%, slightly up from 70% in the previous quarter.

On page 5 is quarterly sequential comparison of income statement. Revenue rose 3.8% quarter-over-quarter to TWD56.3 billion, mainly due to better product mix led to a higher ASP. Gross margin rate at 36% is also slightly better than that of quarter one, and reached TWD20.25 billion. We have been controlling our operating expenses amidst the current semiconductor downturn. So the current operating expenses in quarter two remained flattish at TDO5.7 billion compared to TWD5.78 in Q1 2023.