AI Demand Remains Strong: UMC (UMC.US) July Revenue Surges by 19%, Confirming the Expansion of Computing Power Chains to Mature Processes

According to Zhitong Finance APP, as the global semiconductor sector experiences a sharp correction triggered by chip de-leveraging and concerns over high valuations, leading foundry company United Microelectronics (UMC.US) has released its latest monthly sales data, providing a fundamental boost to panicked Wall Street investors. The company’s unaudited consolidated revenue for July reached NT$23.84 billion, a substantial increase of 18.98% compared to NT$20.04 billion in July 2025. From January to July this year, UMC’s cumulative consolidated revenue totaled NT$153.61 billion, up 12.41% year-on-year.

Breaking Out Of the Slump: Revenue Growth Shows a Clear “Steep Slope”

A closer look at recent monthly data reveals that UMC’s business recovery is showing strong “acceleration of growth rate” characteristics. After last year’s slump and “low single-digit” year-on-year growth in Q1 this year, UMC’s monthly revenue growth rate has soared since April (11% YoY in April, 17.8% in May, nearly 23% in June), and maintained a near-record high of 19% in July.

This series of accelerating growth numbers indicates that the mature process supply chain has fully shaken off the multi-quarter overhang of end-market inventory digestion. Driven by the peak season for traditional consumer electronics and the explosive demand for AI peripheral chips in the second half of the year, the cyclical inflection point for the wafer foundry industry has been firmly established.

July Data Realizes Q2 Full Utilization Guidance, Capital Expenditures Raised Against Headwinds

The robust July sales figures have perfectly validated the optimistic outlook previously offered by UMC during its Q2 earnings report.

During the Q2 earnings call, UMC’s management predicted that, driven by robust downstream demand recovery, wafer shipments in Q3 would see high single-digit sequential growth and utilization rates would rise from 85% in Q2 to above 90% in Q3. Judging from the strong July revenue results, these full-capacity expectations are materializing rapidly.

Financially, UMC’s Q2 operating profit rose 38.2% YoY to NT$14.95 billion, and gross margin improved to 32.5%. Due to strong confidence in orders for the second half and mid-to-long term, UMC has raised its 2026 capital expenditure budget by 25% to $2 billion and approved around $5 billion in phased expansion plans for its Singapore and Tainan sites over the next few years.

Key Focus: AI Computing Power Chain Diffusing Throughout “Mature Process”

In response to previous market concerns that “demand for AI computing infrastructure has peaked,” UMC’s July growth data offers a clear industry explanation and prompts a re-evaluation in the US stock market of the ecosystem value of mature process technology in the AI era.

Analysts point out that the current AI arms race has shifted from a simple “GPU core computing power” contest to a competition constrained by “physical infrastructure.” While TSMC dominates the advanced nodes for top-tier AI GPUs, the rapidly rising power consumption and data transmission bottlenecks in AI data centers have directly fueled explosive demand for PMIC (power management ICs), BCD processes, microcontrollers, advanced sensors, and silicon photonics interconnect chips.

These peripheral critical segments are precisely UMC’s areas of expertise. UMC’s Q2 report shows that revenue from its 22nm process has climbed to a record-high 17.5%, and its 12-inch silicon photonics chips have also achieved first-time mass production and delivery. UMC CEO Jason Wang previously stated that the company expects AI-related revenue to reach $300 million this year and to surpass $1 billion within three years.

Real Demand vs. Stock Market Valuation Cuts

Recently, hurt by macro liquidity tightening and high leverage unwinding, the semiconductor sector has suffered heavy losses. However, UMC’s July acceleration in sales growth, together with recent strong outlooks from TSMC, SK Hynix, and Seagate, form a four-way cross-validation. The numbers show that underlying physical-layer AI infrastructure and electronics industry demand have not shown any signs of decline; the current market plunge is more a result of de-leveraging on the capital side and short-term anxiety over return on investment (ROI).

With the July “strong start” data confirming the trend, US stock market investors will closely watch to see whether UMC can maintain this growth slope in Q3 and whether the surge in utilization can further enhance the company’s overall pricing power and gross margin.