United Microelectronics (NYSE:UMC)

Dr. Shih-Wei Sun, CEO of UMC, said: "In Q4 2011, revenue was in line with UMC's guidance, with a 10% decrease in quarterly shipments contributing to revenue decline. We shipped 915 thousand 8-inch equivalent wafers, with ASP increasing 5% in NT$. Overall utilization was 68%. Revenue from 40nm exceeded 10% of December monthly sales, bringing revenue contribution from this node to 8% for the fourth quarter."

Dr. Sun continued, "Since the first quarter of the year is traditionally slow, UMC's quarterly revenue will decrease slightly from the previous quarter. However, we expect to maintain operating profitability through continuous cost reduction and efficiency enhancement measures. During the slow period, our operating profitability has gained resilience and stability as a result of successful efforts to improve operating structure and diversify risk. From a market standpoint, we have observed several signs that the industry cycle is reaching the bottom and believe that the multi-quarter inventory correction will end soon. However, due to several remaining uncertainties, recovery momentum will be determined by macroeconomic conditions and the strength of end demand.

"UMC is optimistic about the demand for advanced mobile communication and computing chips. To capitalize on this opportunity, we will expand our comprehensive 28nm and 40nm foundry solutions, cooperate with top tier customers to gain more flagship products, and build sufficient capacity. Our 2012 CAPEX budget of US$2 billion will help fulfill this commitment. However, we will not blindly add capacity. Instead, our investment plan is based on progressive stages of both advanced technology readiness and customer capacity requirements. Due to promising 28nm engagements and strong demand, we believe UMC will be well rewarded when 28nm mass production begins. As for 2.5D interposer solution, we have successfully taped out 2.5D interposer for 28nm and 40nm customers. We have also developed an open platform with back-end OSAT partners to extend our foundry services. For 2012, UMC will put forth great effort to strengthen long-term partnerships with customers, provide competitive advanced technology and commit sufficient capacity to secure the next opportunity for growth."