UMC begins mass production of silicon photonics wafers in Singapore
Taiwan's second-largest chipmaker, UMC, has announced the start of mass production for silicon photonics wafers at its Singapore facility. Citi forecasts an improving outlook for the company in the latter half of the year.
Taiwan's second-largest contract chipmaker, United Microelectronics Corporation (UMC), announced Tuesday the commencement of mass production for silicon photonics wafers from its Singapore facility. This new capability aims to address the growing demand for high-speed optical interconnects crucial for AI and hyperscale data centers.
The company collaborated with SILITH Technology, a local fabless chip design firm, to bring the silicon photonics platform from development to production readiness within 18 months. UMC also plans to offer its 12-inch silicon photonics platform for customer product development by 2027.
Analysts at Citi have projected an improving outlook for the chipmaker in the second half of the year. They forecast a 13% quarter-on-quarter sales jump for Q2 2026 and anticipate a recovery in gross margins.
Despite the start of production in Singapore, UMC's stock saw a decline of nearly 5% in Taiwan trading on Tuesday, before paring losses. The company recently reported strong financial performance, with June sales increasing 22.85% year-on-year.