聯華電子 (UMC) 2021 Q2 法說會逐字稿

Welcome, everyone, to UMC's 2021 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.

歡迎大家參加聯電 2021 年第二季度收益電話會議。 （操作員說明）供您參考，此電話會議現在正在互聯網上直播。會議結束後一小時內將提供網絡直播重播。請訪問我們的網站 www.umc.com，在“投資者關係”、“投資者活動”部分下。

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

現在我想介紹一下聯華電子投資者關係主管Michael Lin先生。林先生，請開始。

Thank you, and welcome to the UMC's conference call for the Second Quarter of 2021. I'm joined by Mr. Jason Wang, the President of UMC; and Mr. Chitung 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 forecast and the third quarter 2021 guidance.

謝謝大家，歡迎參加聯華電子 2021 年第二季度的電話會議。聯華電子總裁 Jason Wang 先生也加入了我的行列；以及聯電首席財務官劉啟東先生。稍後，我們將聽到我們的首席財務官介紹第二季度的財務業績，然後是我們的總裁關於解決 UMC 預測和 2021 年第三季度指導的關鍵信息。

Once our President and the CFO complete their remarks, there will be a Q&A session. 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.

我們的總裁和首席財務官完成發言後，將進行問答環節。 UMC 的季度財務報告可在我們的網站 www.umc.com 的“投資者財務”部分獲取。在這次會議期間，我們可能會根據管理層當前的預期和信念做出前瞻性陳述。

These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially, including the risks that may be beyond the company's control. For these risks, please refer to UMC's filing with the SEC in the U.S. and the ROC security authorities.

這些前瞻性陳述受到許多風險和不確定因素的影響，這些風險和不確定因素可能導致實際結果出現重大差異，包括可能超出公司控制範圍的風險。有關這些風險，請參閱聯電向美國證券交易委員會和中華民國安全當局提交的文件。

Now I would like to introduce UMC's CFO, Mr. Chitung Liu, to discuss UMC's second quarter 2021 financial results.

現在我想介紹聯電的首席財務官劉志東先生，討論聯電2021年第二季度的財務業績。

Thank you, Michael. I would like to go through the 2Q '21 investor conference presentation material, which can be downloaded from our website. Starting on Page 3, the second quarter of 2021, consolidated revenue was over the TWD 50 billion mark to reach TWD 50.91 billion, with a gross margin at 31.3%. The net income attributable to the stockholder of the parent was TWD 11.94 billion, and earnings per ordinary shares were TWD 0.98. Our utilization rate in this quarter remained at 100% plus for second quarter.

謝謝你，邁克爾。我想看一下 2Q '21 投資者會議的演示材料，可以從我們的網站下載。從第3頁開始，2021年第二季度綜合收入突破500億新台幣大關，達到509.1億新台幣，毛利率為31.3%。歸屬於母公司股東的淨利潤為新台幣119.4億元，普通股每股收益為新台幣0.98元。我們在本季度的利用率在第二季度保持在 100% 以上。

And the wafer shipment in Q2 of 2021 was 2.44-million-inch wafer equivalent. Please turn to Page 4. Our quarterly revenue in the second quarter reached TWD 50.9 billion, up 8.1%, helped both by the higher wafer shipment as well as increased ASP. Profit margin as a result increased to 31.3% or TWD 15.9 billion. And overall net income attributable to the shareholder of the parent is 23.5% or TWD 11.9 billion. EPS in Q2 2021 was TWD 0.98.

2021年Q2晶圓出貨量為244萬英寸晶圓當量。請翻到第 4 頁。我們在第二季度的季度收入達到 509 億新台幣，增長 8.1%，這得益於更高的晶圓出貨量和更高的平均售價。利潤率因此增加至 31.3% 或新台幣 159 億元。歸屬於母公司股東的整體淨利潤為23.5%或新台幣119億元。 2021 年第二季度每股收益為新台幣 0.98 元。

On Page 5, for the first 6 months of the year, year-over-year comparison, revenue grew by 13.1%, mainly driven by higher volume as well as better product mix and also higher ASP. However, it was somewhat dampened by the increased NT dollar exchange rate against U.S. dollars.

在第 5 頁上，今年前 6 個月的收入同比增長 13.1%，主要是由於銷量增加、產品組合更好以及平均售價更高。然而，新台幣兌美元匯率的上漲在一定程度上抑制了它。

Gross profit margin reached 29% for the first half of 2021 to TWD 28.4 billion. And overall net income reached TWD 22.3 billion or 22.8% margins. EPS for the first 6 months of the year is TWD 1.83.

2021年上半年毛利率達29%至新台幣284億元。整體淨收入達到 223 億新台幣或 22.8% 的利潤率。今年前 6 個月的每股收益為新台幣 1.83 元。

For our balance sheet, our cash on hand is about TWD 124 billion, including about TWD 20 billion will be distributed to shareholders as cash dividend in mid of August. And total equity reached TWD 240 billion, and the net asset dollar value per share is around $19.3. On Page 8, our revenue breakdown by locations. Asia increased -- sorry, on page 8 -- yes, Page 8. Revenue breakdown, Asia remained at 63% and Japan increased to about 7%, and the rest 2 regions remained somewhat unchanged.

就我們的資產負債表而言，我們的手頭現金約為1240億新台幣，其中約200億新台幣將在8月中旬作為現金股息派發給股東。總股本達2400億新台幣，每股淨資產約為19.3元。在第 8 頁，我們的收入按地點細分。亞洲增加了——抱歉，在第 8 頁——是的，第 8 頁。收入細分，亞洲保持在 63%，日本增加到 7% 左右，其餘 2 個地區保持不變。

I'm sorry, on Page 7, therefore, I can skip the page earlier. ASP in quarter 2 increased by close to 5%. So back to Page 9. IDM represents 16% of the total revenue and Fabless is the rest of 84%. On Page 10, our Communications segment is 47%. Consumer is around 26%.

對不起，在第 7 頁，因此，我可以先跳過該頁。第二季度的平均售價增長了近 5%。回到第 9 頁。IDM 佔總收入的 16%，Fabless 佔其餘的 84%。在第 10 頁，我們的通信部門是 47%。消費者約為26%。

So on Page 11, our overall revenue below 40-nanometer is around 38%, and 28-nanometer since it's running at 100% capacity utilization rate is around 20%, similar to that of last quarter. And our capacity -- total capacity table show some incremental increase, mainly for 12A as well as 12X. And going forward, for third quarter, there will still be some debottleneck type of capacity increase for selected sets.

因此，在第 11 頁上，我們 40 納米以下的總收入約為 38%，而 28 納米，因為它以 100% 的產能利用率運行，因此約為 20%，與上一季度相似。而我們的容量——總容量表顯示了一些增量增加，主要是 12A 和 12X。展望未來，對於第三季度，選定機組仍將出現一些去瓶頸類型的產能增加。

So for Page 13, our CapEx for 2021. The budget remained unchanged to around USD 2.3 billion. So the above is a summary of UMC's results for Q2 2021. More details are available in the report, which has been posted on our website. I will now turn the call over to President of UMC, Mr. Jason Wang.

因此，對於第 13 頁，我們 2021 年的資本支出。預算保持不變，約為 23 億美元。因此，以上是聯電 2021 年第二季度業績的摘要。更多詳細信息可在已發佈在我們網站上的報告中找到。我現在將把電話轉給聯華電子總裁 Jason Wang 先生。

Thank you, Chitung. Good evening, everyone. Here, I would like to update the second quarter operating result of UMC. Strong demand fueled by 5G adoption and digital transformation underpinned our strong performance in the second quarter. Our manufacturing facility is 100% utilization, while overall wafer shipment rose 3% quarter-over-quarter to 2.44 million, 8-inch equivalents.

謝謝你，啟東。各位晚上好。在這裡，我想更新一下聯華電子第二季度的經營業績。 5G 採用和數字化轉型推動的強勁需求支撐了我們第二季度的強勁表現。我們的製造設施利用率為 100%，而整體晶圓出貨量環比增長 3% 至 244 萬片 8 英寸當量。

Revenue from 28-nanometer technology continued to grow sequentially, build by application incorporate into 4G, 5G smartphones, solid-state drive and digital TV.

來自 28 納米技術的收入繼續環比增長，通過應用融入 4G、5G 智能手機、固態硬盤和數字電視。

During the quarter, we continued our product optimization and cost reduction efforts, lifting our gross margin. We expect the strength of structural demand to sustain and support the continuous improvement of a blended ASP. As a result, the company's gross profit in the first half of 2021 surged 54.5% year-over-year to TWD 28.4 billion.

本季度，我們繼續努力優化產品和降低成本，提高了毛利率。我們預計結構性需求的強度將維持和支持混合平均售價的持續改善。因此，公司 2021 年上半年的毛利同比增長 54.5% 至新台幣 284 億元。

Looking ahead, we anticipate demand to stay robust in the third quarter, driven by megatrends such as 5G and EV. Supply tightness is expected to continue across 8-inch and 12-inch facilities. We foresee margin momentum to continue into the third quarter, supported by further product mix optimization, cost reduction efforts and productivity enhancements. In addition, we expect the adoption rate of our 22-nanometer technologies will continue to gain traction, reflected by a pickup in customers' 22 product tape-outs in connectivity and display applications.

展望未來，我們預計在 5G 和電動汽車等大趨勢的推動下，第三季度需求將保持強勁。預計 8 英寸和 12 英寸設施的供應緊張情況將持續。在進一步優化產品組合、降低成本和提高生產力的支持下，我們預計利潤率勢頭將持續到第三季度。此外，我們預計我們 22 納米技術的採用率將繼續獲得牽引力，這反映在客戶在連接和顯示應用中的 22 種產品流片中。

We will also focus on further strengthening our leadership position in a number of specialty technologies, such as OLED display drivers, RF SOI and image applications. Moreover, we continue to take important steps to enhance our corporate governance and lead sustainability efforts in our industry. Earlier this month, 5 independent directors were newly elected to our company's Board of Directors, representing more than 50% of the Board seats and including 2 female directors.

我們還將專注於進一步加強我們在許多專業技術方面的領先地位，例如 OLED 顯示驅動器、RF SOI 和圖像應用。此外，我們繼續採取重要步驟來加強我們的公司治理並引領我們行業的可持續發展努力。本月初，我公司董事會新選舉了5名獨立董事，佔董事會席位的50%以上，其中女性董事2名。

The company also announced its pledge to reach net-zero carbon emissions by 2050, as well as our commitments to work alongside our partners to reduce carbon intensiveness and rise renewable energy usage in our supply chain. UMC is dedicated to enhance our corporate governance as well as addressing climate change to build a sustainable environment.

該公司還宣布了到 2050 年實現淨零碳排放的承諾，以及我們與合作夥伴共同努力降低碳強度和增加供應鏈中可再生能源使用的承諾。聯華電子致力加強企業管治及應對氣候變化，以建立可持續發展的環境。

Now let's move on to third quarter 2021 guidance. Our wafer shipments will increase by 1% to 2%. ASP in U.S. dollar will increase by approximately 6%. Gross profit margin will be in the mid-30% range. Capacity utilization rate will be at 100%. Our 2021 cash-based CapEx will be budgeted at USD 2.3 billion. That concludes my comments. Thank you all for your attention. Now we are ready for questions.

現在讓我們繼續討論 2021 年第三季度的指導方針。我們的晶圓出貨量將增加 1% 到 2%。以美元計算的平均售價將增加約 6%。毛利率將在30%左右。產能利用率將達到100%。我們 2021 年基於現金的資本支出預算為 23 億美元。我的評論到此結束。謝謝大家的關注。現在我們準備好提問了。

(Operator Instructions) The first question is coming from Randy Abrams, Crédit Suisse.

（操作員說明）第一個問題來自瑞士信貸銀行的 Randy Abrams。

Congratulations on the continued improvement. First question I wanted to ask on your strategy for mature 12-inch and 8-inch. Last quarter, when you announced the expansion, it looked more tied to 28 and 40. So I'm curious if you have plans on available capacity to add for the more mature nodes for us on 8-inch?

祝賀您的持續改進。第一個問題我想問一下你們成熟的12寸和8寸的策略。上個季度，當你宣布擴張時，它看起來更依賴於 28 和 40。所以我很好奇你是否有計劃在可用容量上為我們在 8 英寸上增加更成熟的節點？

Well, the last time we announced the P6 is all centered with the 28-nanometer capacity with the option to upgrade to 22 in the future, okay? We -- in terms of the other notes, in addition to 28, we mainly focused on some of the limited broad space expansion.

好吧，上次我們宣布P6都是以28納米容量為中心，未來可以升級到22納米，好嗎？我們——就其他筆記而言，除了 28，我們主要關註一些有限的廣闊空間擴展。

So it's rather limited on 40 as well as 50. In general, our strategy in the CapEx is we remain our disciplined CapEx philosophy, and from 2017. We always try to drive our sustainable structure profitability based on disciplined tax principle. So we have to align with our customer and as well as the market and giving our relevance in the marketplace before we're making that decision.

所以它在 40 和 50 上相當有限。總的來說，我們在資本支出方面的戰略是我們保持我們嚴格的資本支出理念，從 2017 年開始。我們總是試圖根據嚴格的稅收原則來推動我們可持續的結構盈利能力。因此，在我們做出決定之前，我們必須與我們的客戶和市場保持一致，並提供我們在市場中的相關性。

At this point, we're more focused on the 28 technology at this time. For the -- in general, the 12-inch material node and 8-inch are facing our ROI challenges in capacity expansion investment. And we are looking for opportunity to work with our customers to overcome the challenges if possible. In the meantime, we will continue to enhance our productivity improvement and strengthen our value proposition to enhance the customer stickiness within those nodes. That's sort of how we address this.

在這一點上，我們此時更關注 28 技術。對於——總的來說，12 英寸材料節點和 8 英寸正面臨著我們在產能擴張投資中的 ROI 挑戰。如果可能的話，我們正在尋找與客戶合作的機會來克服挑戰。與此同時，我們將繼續提高我們的生產力並加強我們的價值主張，以增強這些節點內的客戶粘性。這就是我們解決這個問題的方式。

Okay. And I guess in talking like to overcome challenges, is it your view is just not the economics, like the return to invest on more mature 12-inch and just not many opportunities to find 8-inch space? Is that more of the issue or just more of the view market demand, more of your opportunities, 28 and 40? So that's where you'll put the investment?

好的。而且我想在談論喜歡克服挑戰時，您的觀點是不是經濟學，就像投資於更成熟的 12 英寸的回報和找到 8 英寸空間的機會不多？ 28 歲和 40 歲，這是更多的問題還是更多的觀點市場需求，更多的機會？那就是你要投資的地方？

You're right. It's more of economics and the full space available. But for any greenfield capacity expansion, for the mature node, you are competing with a fully -- most likely, you're going to be competing with a fully depreciated capacity. Unless the demand is significantly important to the customer, but the economics -- if the economics stay the same, it will be very difficult to have a justified ROI. However, if the customer is willing to face those challenges together with us, we will definitely explore those opportunities.

你是對的。它更多的是經濟性和可用的全部空間。但是對於任何綠地容量擴展，對於成熟節點，您正在與完全 - 最有可能的是，您將與完全折舊的容量競爭。除非需求對客戶非常重要，但經濟性——如果經濟性保持不變，將很難獲得合理的投資回報率。但是，如果客戶願意與我們一起面對這些挑戰，我們一定會探索這些機會。

Okay. Great. That's helpful. Second question on pricing. It's getting another good...

好的。偉大的。這很有幫助。第二個關於定價的問題。又有好事了...

Excuse me. Hello?

打擾一下。你好？

Hello?

你好？

Yes.

是的。

Randy, you are breaking up. Yes, can you repeat your question?

蘭迪，你要分手了。是的，你能重複你的問題嗎？

Okay. Yes. Okay. Sorry, I was cut out for a second. Okay. Yes, the second question I wanted to ask, if you could discuss your view on pricing from the higher base, where it's up nicely in third quarter. Do you expect it would continuously grow in fourth quarter? And if you have an initial view on 2022, the pricing, if you've said anything or even for the new phase, the Phase 5 expansion if you get higher price? And then do you have a target like where gross margin factoring the pricing you're seeing where the potential gross margin could move toward?

好的。是的。好的。對不起，我被切斷了一秒鐘。好的。是的，我想問的第二個問題是，你是否可以討論你對較高基數定價的看法，第三季度的定價很好。您預計第四季度會繼續增長嗎？如果你對 2022 年有初步看法，定價，如果你說過什麼，甚至對於新階段，如果你獲得更高的價格，第 5 階段擴展？然後你有沒有一個目標，比如你看到潛在毛利率可能走向的定價的毛利率？

Well, we typically don't provide any guidance beyond the quarter. So we definitely will address the Q4 guidance during the Q3 conference. But in general, it's our belief that pricing for structural demand is here to stay. And I also believe our customers start recognizing the UMC value and award our contribution. So we do expect the strength of structured demand -- momentum will sustain beyond the Q4 2021.

好吧，我們通常不會在本季度之後提供任何指導。所以我們肯定會在第三季度會議期間討論第四季度的指導。但總的來說，我們相信結構性需求的定價將繼續存在。我也相信我們的客戶開始認可 UMC 的價值並獎勵我們的貢獻。因此，我們確實預計結構性需求的強勁勢頭將持續到 2021 年第四季度之後。

Okay. And just 1 last follow-up. Looking out to 2023, since you announced your expansion, like a number of foundries are also seeing that need and adding capacity, do you see by '23 -- you're contracting in to fix it. But do you view by '23, a change in that kind of structural, at least or maybe cyclical, more supply and at that point, kind of pricing goes back to the normal kind of some erosion? Or how do you see it looking out 2 years as some of these Fabs come online?

好的。最後一次跟進只有 1 次。展望 2023 年，自從您宣布擴張以來，就像許多代工廠也看到了這種需求並增加了產能，您是否看到 23 年之前——您正在承包以修復它。但是你是否認為到 23 年，這種結構性的變化，至少或可能是周期性的，更多的供應，到那時，某種定價又回到了正常的某種侵蝕？或者您如何看待未來 2 年，因為其中一些晶圓廠上線了？

Well, again, I mean we're not here to predict the -- about the nature of this industry. But in general, a new greenfield Fab will take more than 2 years to build, right? Just like you said, we're not looking at this tightness situation to get relief until 2023. And however, based on the industry research, the worldwide semiconductor market growth rate will actually accelerate all the way from 2020 to 2025, driven by the 5G digital transformation, HPC, EV and IoT.

好吧，我的意思是我們不是來預測這個行業的性質的。但一般來說，新建一個 Fab 需要 2 年以上的時間才能建成，對吧？就像你說的，我們不會在 2023 年之前看到這種緊縮情況得到緩解。但是，根據行業研究，全球半導體市場增長率實際上將在 2020 年至 2025 年期間一路加速，受 5G 的推動數字化轉型、高性能計算、電動汽車和物聯網。

And so we do believe this up cycle will continue for a period. Of course, we can never guarantee 100% back loading in all the time. From the financials perspective, we have to maintain an edge in cost competitiveness to ensure the healthy gross margin, so that allow UMC to weather the storm during the downturn. So from that standpoint, we have to address this fundamentally, okay?

因此，我們確實相信這個上升週期將持續一段時間。當然，我們永遠無法保證始終 100% 的回載。從財務角度來看，我們必須保持成本競爭力的優勢，以確保健康的毛利率，讓聯電在低迷時期渡過難關。所以從這個角度來看，我們必須從根本上解決這個問題，好嗎？

And in order to address this -- maintain such healthier ASP or gross margin, let's say, what we do is from the recent up-cycle, we take the opportunity to optimize our product portfolio, enhance our technology competitiveness, and with -- along with our manufacturing capability. And we believe those efforts can strengthen our relationship with the customer and UMC's market position to maintain the current position.

為了解決這個問題——保持更健康的 ASP 或毛利率，比方說，我們所做的是從最近的上升週期開始，我們藉此機會優化我們的產品組合，提高我們的技術競爭力，以及——憑藉我們的製造能力。我們相信這些努力可以加強我們與客戶的關係以及聯電的市場地位，以保持目前的地位。

So I'm not here to predict whether we can approach this ASP continuously. But I do think by enhancing our capability, we'll be able to compensate the market volatility or even potential capacity oversupply situation.

所以我不是來預測我們是否可以不斷接近這個 ASP。但我確實認為，通過增強我們的能力，我們將能夠彌補市場波動甚至潛在的產能供過於求的情況。

And next question is coming from Brett Simpson, (inaudible) Research.

下一個問題來自 Brett Simpson，（聽不清）Research。

I wanted to ask about some of the long-term agreements you're signing. And what sort of commitment, wafer commitment guarantees are being negotiated? And how enforceable these agreements are, particularly if we see industry conditions start to normalize after this unusual period of supply challenges? Anything you can share with us around the enforceability of any sort of wafer commitments that your customers are making here long term?

我想問問你們正在簽署的一些長期協議。正在談判什麼樣的承諾，晶圓承諾保證？這些協議的可執行性如何，特別是如果我們看到行業狀況在這段不尋常的供應挑戰期後開始正常化？關於您的客戶在這里長期做出的任何類型的晶圓承諾的可執行性，您能與我們分享什麼嗎？

Well, the -- we reported last quarter, the agreement has a long-term protection mechanism to ensure the -- our newly expanded capacity will be maintained at a healthy level. The -- such mechanism includes the mutual obligations from customers as well as from our side. And so by fulfilling those obligations, we believe that the loading can be sustained at a healthy level.

好吧，我們上個季度報告說，該協議有一個長期保護機制，以確保我們新擴大的產能將保持在健康水平。這種機制包括客戶和我們雙方的相互義務。因此，通過履行這些義務，我們相信負載可以維持在健康水平。

As far as the detail of the mechanism, I'm not elaborate to share on the call, but I -- but we have -- we actually have a very serious and comprehensive discussion with our customer, and we do believe such mechanism is adequately adopted.

至於機制的細節，我不會在電話會議上詳細分享，但我 - 但我們 - 我們實際上與我們的客戶進行了非常認真和全面的討論，我們確實相信這種機制是充分的採用。

And so even if we have a sudden change in industry conditions, you feel quite confident that your customer obligations will be -- they will continue to commit to those obligations, basically if there's an oversupply situation in the industry or something that we see in the years to come?

因此，即使我們的行業狀況突然發生變化，您也很有信心您的客戶義務將是——他們將繼續履行這些義務，基本上如果行業出現供過於求的情況或我們在行業中看到的情況未來幾年？

Yes, we believe it will be well protected from a financials -- potential financial implication.

是的，我們相信它將受到很好的保護，免受財務影響——潛在的財務影響。

Great. Great. And just 1 follow-up on dividends. Now that you're delivering healthy free cash flow, healthy margin -- improvements in margins, can you talk a bit about the vision around dividends? And how to think about returns to shareholders? I mean we haven't had a sort of formal policy from UMC. Is it a payout ratio you look to target in terms of your dividend policy? Any thoughts there around? As you continue to sustain this type of margin structure, how the dividends might evolve going forward?

偉大的。偉大的。並且只有 1 個後續股息。既然你正在提供健康的自由現金流，健康的利潤率——利潤率的提高，你能談談關於股息的願景嗎？以及如何考慮股東回報？我的意思是我們還沒有 UMC 的正式政策。這是您在股息政策方面希望達到的派息率嗎？周圍有什麼想法嗎？隨著您繼續維持這種類型的保證金結構，未來股息可能會如何演變？

Yes. We do have a dividend policy, which is we will pay our distributable earnings in cash, no less than 50%. So that's our policy. Of course, for the recent years, we are much higher in terms of payout ratio. But I think going forward, we're looking to distribute a stable and hopefully increasing cash dividend along with our improved EPS.

是的。我們確實有股息政策，即我們將以現金支付我們的可分配收益，不少於 50%。這就是我們的政策。當然，最近幾年，我們的派息率要高得多。但我認為展望未來，我們希望在提高每股收益的同時分配穩定且有望增加的現金股息。

Great. And maybe just 1 final question. In terms of your implied Q3 -- the Q3 guide implies your wafer pricing is up high teens year-on-year. Does the current ASPs fully reflect your long-term agreements that are in place?

偉大的。也許只有最後一個問題。就你隱含的第三季度而言——第三季度指南暗示你的晶圓價格同比上漲了十幾歲。當前的 ASP 是否充分反映了您的長期協議？

The long-term agreement won't kick in until 2023, if you are referring to the P6 project. I think our ASP increase is mainly driven by our product mix optimization in quarter 2. And there will be some price increase as well as product optimization continue into quarter 3. So the long-term contract for P6 won't be effective until 2023.

如果您指的是 P6 項目，則長期協議要到 2023 年才會生效。我認為我們的 ASP 增長主要是由我們在第二季度的產品組合優化推動的。並且會有一些價格上漲以及產品優化將持續到第三季度。因此 P6 的長期合同要到 2023 年才會生效。

And next, we'll have Charlie Chan of Morgan Stanley for questions.

接下來，我們將請摩根士丹利的 Charlie Chan 提問。

Congratulations for great results. So I also really want to follow up some questions about the pricing. So just a hypothetical question, right? If there is a kind of a cycle downturn, how confident that management can maintain the current wafer price? I'm not talking about the P6. I'm talking about other than P6, whether companies think that price can sustain in the down cycle?

祝賀你取得好成績。所以我也很想跟進一些關於定價的問題。所以只是一個假設性的問題，對吧？如果出現週期性低迷，管理層有多大信心維持目前的晶圓價格？我不是在談論 P6。我說的是除了P6以外，企業是否認為價格能夠在下行週期中維持？

Well, I mean we are giving guidance for 2021. So we don't think there's any inflection point of the down cycle yet. So the -- for a hypothetical question going into, let's say, 2023, 2024 for whatever reason, there is a so-called down cycle. We just have to execute in our plan, like I mentioned earlier, to Randy's question.

好吧，我的意思是我們正在為 2021 年提供指導。所以我們認為下行週期還沒有任何拐點。因此 - 對於一個假設性的問題，比方說，無論出於何種原因進入 2023 年、2024 年，都有一個所謂的下行週期。對於 Randy 的問題，我們只需要執行我們的計劃，就像我之前提到的那樣。

There's a lot of activity associated with that. So I don't really think this is the right time to predict whether this is going to be a down cycle or not, but we are definitely prepared to dealing with those situations. So our technology offering to our manufacturing capability as well as based on the selected market that more associated with the structural demand.

有很多與此相關的活動。所以我真的不認為現在是預測這是否會成為下行週期的正確時機，但我們絕對準備好應對這些情況。因此，我們的技術提供給我們的製造能力以及基於與結構需求更相關的選定市場。

And we believe those activity will help us with our -- the vulnerability in terms of demand change. I think that's how we address that issue. And we -- of course, again, I'm saying that we can't really guarantee there's always up-cycle. But given what we have seen in the recent up-cycle, we already took those opportunities to optimize our product portfolio and along with enhancing our technology competitiveness to align with our customers. So we are seeing a good progress on that front.

我們相信這些活動將幫助我們應對需求變化方面的脆弱性。我認為這就是我們解決該問題的方式。而且我們 - 當然，我再次說我們不能真正保證總是有上升週期。但鑑於我們在最近的上升週期中看到的情況，我們已經利用這些機會優化我們的產品組合，並提高我們的技術競爭力以與我們的客戶保持一致。因此，我們在這方面看到了良好的進展。

Okay. Yes, so when you form your wafer price, no matter for this year or 2022, do you really compare or refer to your industry peers, especially the so-called industry leader, TSMC? So my question is actually, do you see, for example, at the 28-nanometer or 40-nanometer, do you see any technology gap or quality performance difference versus TSMC? And whether you can price on par or even higher than TSMC?

好的。是的，所以你在製定晶圓價格的時候，無論是今年還是2022年，你真的是在比較或參考你的同行，尤其是所謂的行業龍頭台積電嗎？所以我的問題實際上是，您是否看到，例如，在 28 納米或 40 納米處，您是否看到與台積電相比有任何技術差距或質量性能差異？又能否定價與台積電持平甚至更高？

Well, we do believe we are competitive in those technology nodes, process nodes. In fact, we'll continue driving our technology offering to enhance those areas, in particularly on the high-v, RFSOI, the BCD and better fresh area.

好吧，我們確實相信我們在那些技術節點、流程節點上具有競爭力。事實上，我們將繼續推動我們的技術產品以增強這些領域，特別是在高電壓、RFSOI、BCD 和更好的新鮮領域。

We'll continue to strengthen our offering in the technology area. So I think we are reasonably competitive in those space, not if we are in the leading position. So as far as for the price ASP goals, we do believe that customer start recognizing that and start reflecting -- the ASC starts reflecting some of our technology offering and competitiveness.

我們將繼續加強我們在技術領域的產品。所以我認為我們在這些領域具有合理的競爭力，而不是如果我們處於領先地位。因此，就價格 ASP 目標而言，我們確實相信客戶開始認識到這一點並開始反思——ASC 開始反映我們的一些技術產品和競爭力。

And we've seen the market price -- industry marketplace is a good reference, and we'll continue to benchmark those and we think we are already bridging the gap and into a comfortable level. Yes.

我們已經看到了市場價格——行業市場是一個很好的參考，我們將繼續以這些為基準，我們認為我們已經縮小了差距並進入了一個舒適的水平。是的。

And then some of housekeeping question, right? I mean I'm not sure what was the progress of your China Xiamen Fab, right, because previously, there were some chatters about there is some difficulty for China to import some equipment's, for example, AP2 from applied materials. Do you think that would affect your capacity expansion plan in China for 20-nanometer? And also the question to Chitung is about, from here, right, your gross margin is around mid-30%. What is the company's long-term financial goal in terms of gross margin, OP margin and ROE?

然後是一些客房服務問題，對嗎？我的意思是我不確定你們中國廈門工廠的進展如何，對吧，因為之前有一些傳言說中國進口一些設備有一些困難，比如應用材料的AP2。您認為這會影響你們在中國20納米的產能擴張計劃嗎？還有問 Chitung 的問題是，從這裡開始，你的毛利率大約在 30% 左右。公司在毛利率、經營利潤率和股本回報率方面的長期財務目標是什麼？

So for 12-inch in Xiamen. Our Xiamen 12-inch wafer fab, we actually have already reached the full scale of 26.5k per month based on our design capacity. So pretty much we reached what we intended to expand for Xiamen fab already. For our GM question, the GM outlook, our CEO, our President, will comment on that.

所以在廈門換12寸。我們廈門的12寸晶圓廠，按照我們的設計產能，其實已經達到了月產2.65萬片的滿產規模。所以我們幾乎已經達到了我們打算為廈門晶圓廠擴展的目標。對於我們的通用汽車問題，通用汽車的前景，我們的首席執行官，我們的總裁將對此發表評論。

For the gross margin outlook, our gross margin outlook will be mainly derived from our production efficiency as well as the ASP trend. UMC as the company will continue to work on the product mix optimization. I kind of touched that earlier and continued efforts on cost reduction efforts and operational efficiency in order to strengthen our structural gross margin. So we do have expectations that continue to improve us, yes.

對於毛利率前景，我們的毛利率前景將主要來自我們的生產效率和平均售價趨勢。聯電作為公司將繼續致力於產品結構優化。我有點觸及這一點，並繼續努力降低成本和提高運營效率，以加強我們的結構性毛利率。所以我們確實有繼續改善我們的期望，是的。

And next question, Roland Shu, Citigroup.

下一個問題，花旗集團的 Roland Shu。

Now your 28-nanometer is the biggest node in revenue. I would like to know how about the -- does that 28-nanometer is contributed to the upside to your total profit? And also for your 45-nanometer, the revenue actually continued declining from 3Q last year. And is there any empathy or idle capacity for 45-nanometer? Or are you convert this 45-nanometer capacity to 28-nanometer or others? That's my first question.

現在你的 28 納米是最大的收入節點。我想知道 - 28 納米是否對你們的總利潤有所貢獻？而且對於您的 45 納米，收入實際上比去年第三季度繼續下降。 45納米是否有同理心或閒置產能？還是將這個 45 納米容量轉換為 28 納米或其他容量？這是我的第一個問題。

Yes. All our nodes are actually fully loaded. And keeping a different mix of wafer out in different quarters, you will see some variables in the mix of the technology node. By this time, there is no vacancy in the fab. In fact, all nodes are running over 100%. The question about the 28 expansion going forward for the -- to the gross margin.

是的。我們所有的節點實際上都已滿載。並且在不同的季度保持不同的晶圓組合，你會在技術節點的組合中看到一些變量。到這個時候，晶圓廠已經沒有空缺了。事實上，所有節點都在 100% 以上運行。關於毛利率的 28 次擴張的問題。

And our unique 28 logic and specialty technology offering will enhance the customers' competitiveness. As a result, as in the customer's reliance on our 28 capacity is in great demand. This competitiveness will allow us to enjoy a healthier EBITDA margin in the longer term. In the longer term, we actually expect the 28-nanometer capacity expansion will play as a catalyst to further drive our gross margin expansion.

我們獨特的 28 邏輯和專業技術產品將增強客戶的競爭力。因此，由於客戶對我們 28 容量的依賴，需求量很大。從長遠來看，這種競爭力將使我們能夠享受更健康的 EBITDA 利潤率。從長遠來看，我們實際上預計 28 納米產能擴張將成為進一步推動毛利率擴張的催化劑。

Understood. So even for your 3Q gross margin guidance, mid-30 percentage points, did also have a big contribution from 28-nanometer?

明白了。因此，即使對於您的 3Q 毛利率指導，30 個百分點中期，28 納米也有很大貢獻嗎？

Yes, the ASP in Q3 guidance, the ASP is expect to grow 6% quarter-over-quarter, primarily driven by price adjustment. In our Q2, the ASP increase is mainly driven by both the price adjustments on the select application in 12-inch in a mature site and as well as 8-inch, and also coupled with the product mix improvement, which means the higher 28 shipments. For Q3, our expected AC growth primarily driven by the price adjustment of 12- and 8-inch nodes.

是的，第三季度的平均售價預計環比增長 6%，主要受價格調整推動。在我們的第二季度，平均售價的增長主要是由成熟站點中 12 英寸和 8 英寸的選擇應用程序的價格調整推動的，同時還加上產品組合的改善，這意味著更高的 28 出貨量.對於第三季度，我們預期的 AC 增長主要由 12 英寸和 8 英寸節點的價格調整驅動。

Understood. Okay. Yes. But I think my question actually is for the gross margin for 28-nanometer. How does it contribute to your gross margin in 3Q?

明白了。好的。是的。但我認為我的問題實際上是關於 28 納米的毛利率。它對你們第三季度的毛利率有何貢獻？

So Roland, we have mentioned that 28 has no doubt the higher EBITDA margin compared to the other main nodes, mainly because of higher ASP. And all the dynamics -- the parameters are dynamic quarter-over-quarter. So we cannot give you a straightforward answer. But as Jason just mentioned, for the longer term, 28 for sure will be a catalyst in driving our margin expansion.

所以 Roland，我們提到 28 無疑比其他主要節點具有更高的 EBITDA 利潤率，主要是因為更高的 ASP。所有的動態——參數都是動態的季度環比。所以我們不能給你一個直截了當的答案。但正如 Jason 剛才提到的，從長遠來看，28 肯定會成為推動我們利潤率擴張的催化劑。

Understood. If I look at your annual report, at least your contract with [Jinhua] was due in May. So I would like to understand, will there any impact on your P&L or on your balance sheet from 3Q or on after this contract has been built in May?

明白了。如果我看你的年度報告，至少你與[金華]的合同是在五月份到期的。所以我想了解一下，從 3 季度或 5 月簽訂該合同後，對您的損益表或資產負債表是否有任何影響？

So for the contract, it has been currently on hold, okay? So there's not any progress at all for these Jinhua-related activity. So no...

那麼對於合同，目前已經擱置了，好嗎？所以這些與金華有關的活動，一點進展都沒有。所以不行...

So no financial impact as well, right?

所以也沒有財務影響，對吧？

Yes.

是的。

Okay. Okay. And also, now you have been node -- every node of your capacity at more than 100% utilization. However, given in the past several quarters, every quarter, you still manage to increase the capacity by several percentage points or by capacity debottlenecking. So I just want to know how long can you still debottleneck your capacity going forward? And will it be sustainable for you to increase this 2% to 3% or even several percent despite of the wafer shipment increase every quarter from capacity debottlenecking, even though you are not at very high utilization?

好的。好的。而且，現在您已經成為節點——您容量的每個節點都處於 100% 以上的利用率。但是，鑑於過去幾個季度，每個季度，您仍然設法將產能提高幾個百分點或通過產能去瓶頸。所以我只想知道您還能在多長時間內消除產能瓶頸？儘管晶圓出貨量每個季度都因產能去瓶頸而增加，即使您的利用率不是很高，您將這 2% 到 3% 甚至幾個百分點增加是否可持續？

Well, debottlenecking and the productivity improvement is ongoing efforts that will continue. And for the capacity expansion is you're referring to the overall results here, our 2021 increased about 3%, right? And for the 2022, we expect to increase by another 6% year-over-year. So that's going to be a new expansion. And all the debottlenecking and the productivity improvement will be on ongoing basis.

好吧，消除瓶頸和提高生產力是持續不斷的努力。對於產能擴張，你指的是這裡的整體結果，我們 2021 年增長了大約 3%，對嗎？而對於 2022 年，我們預計將再同比增長 6%。所以這將是一個新的擴展。所有的去瓶頸和生產力的提高都將持續進行。

Next question coming from Szeho Ng, China Renaissance.

下一個問題來自華興資本的 Szeho Ng。

First question regarding P6. Initially, it's targeting the 28 and 22 nano. I just wondered if the capacity will be upgradable to a 14-nano or FinFET?

關於P6的第一個問題。最初，它的目標是 28 和 22 納米。我只是想知道容量是否可以升級到 14 納米或 FinFET？

The answer is yes. The both nodes are flexible to manufacture for 14, Yes.

答案是肯定的。兩個節點都可以靈活地製造 14 個，是的。

Okay. Great. And how easy would that be for the upgrade? And how much would it cause roughly on a per K basis?

好的。偉大的。升級有多容易？以每千克為基礎，它會造成多少？

Well, the number is -- actually, we -- I don't think we're ready to quote that number because the -- I said the number -- there's still some uncertainty with the numbers. But the comment on 28, the both to the 40 things that are in a high percentage range. So we do believe that is the right node for a potential upgrade. And since we're not there yet, whether we serve the specific number at a later time.

好吧，這個數字是——實際上，我們——我認為我們還沒有準備好引用這個數字，因為——我說了這個數字——這些數字仍然存在一些不確定性。但是對 28 的評論，這兩個到 40 的東西都處於高百分比範圍內。因此，我們確實相信這是進行潛在升級的正確節點。既然我們還沒有到那兒，我們是否會在以後提供特定的號碼。

Okay. Great. Yes. No worry. And regarding the FinFET, what's the company's latest thoughts on that part of business?

好的。偉大的。是的。別擔心。關於FinFET，公司對這部分業務的最新想法是什麼？

Again, I didn't get that number.

再一次，我沒有得到那個號碼。

What's the company's strategy for the FinFET going forward?

公司未來的 FinFET 戰略是什麼？

Well, I mean when we developed the technology, the -- actually, when we see the capacity expansion on 14 a few years back, but we did not see the technology development on the 14 for the reason I mentioned earlier. Means the 14 and 28 is still at a high percentage of conversion ratio.

好吧，我的意思是，當我們開發這項技術時，實際上，當我們看到幾年前 14 的產能擴張時，但由於我之前提到的原因，我們沒有看到 14 的技術發展。意味著 14 和 28 仍然處於很高的轉化率百分比。

And also, the 14 does provide some technology advancements in terms of power and the savings. So we believe that's the right technology to continue develop. So at this point, the 14 has been fully developed. However, we are aligning with our customer and -- to triggering the CapEx decision.

而且，14 確實在功率和節省方面提供了一些技術進步。所以我們相信這是繼續發展的正確技術。所以至此，14已經開發完畢。但是，我們正在與我們的客戶保持一致，並觸發資本支出決策。

Given the current market outlook, the 28 remains to be a strong node. So we still prioritize our resource on the 28 at this time. So the option is there, but it's still subject to our, like I said, the CapEx policies. So we'll continue guided by that at the right time, at the right place and the right volume, we'll make that decision. So the 14 is an option for us.

鑑於目前的市場前景，28 日仍然是一個強勢節點。因此，我們目前仍將我們的資源優先放在 28 號上。所以選擇是存在的，但它仍然受制於我們的資本支出政策，就像我說的那樣。因此，我們將繼續在正確的時間、正確的地點和正確的數量的指導下做出決定。所以 14 是我們的一個選擇。

Okay. Great. And my second question is regarding the profitability of your Japan Fab. And how does it compare with the group average right now?

好的。偉大的。我的第二個問題是關於你們日本工廠的盈利能力。與現在的小組平均水平相比如何？

So based on the integration effort at 12-inch, which saw Japanese Fab, the cost reduction activity and productivity improvement has led to a very efficient operation enhancement. Therefore, we do expect the 12-inch Japanese Fab gross margin will be in line with UMC's 12-inch corporate average.

因此，基於日本晶圓廠在 12 英寸的集成工作，成本降低活動和生產力提高導致了非常有效的運營增強。因此，我們確實預計 12 英寸日本晶圓廠的毛利率將與 UMC 的 12 英寸企業平均水平一致。

And next question is from Nicolas Barrett, Macquarie.

下一個問題來自麥格理的 Nicolas Barrett。

Could I clarify if I heard properly, Mr. Wang. Capacity, this year increased by 3% and next year, 6%. Was this correct?

王先生，請問我沒聽錯嗎？運力，今年增加 3%，明年增加 6%。這是正確的嗎？

The capacity increase for 2021, this year, is 3%. That's the year-over-year for 2021. The 6% year-over-year is for in 2022.

今年 2021 年的產能增長為 3%。這是 2021 年的同比增長。6% 的同比增長是 2022 年的。

The 6% is in 2020. Since you're running at 100% utilization, does that give you better visibility into the coming quarters?

6% 是在 2020 年。由於您的利用率為 100%，這是否能讓您更好地了解未來幾個季度？

Visibility for the next quarter, of course, it's quite solid. And we continue to work with our customers closely about their rolling forecast. So for the visibility right now, of course, I think it's better than most of the time we experienced in the past.

當然，下一季度的能見度非常穩固。我們將繼續與客戶密切合作，了解他們的滾動預測。因此，對於現在的知名度，當然，我認為這比我們過去經歷的大部分時間都要好。

Would you say that gives you visibility into beginning of next year?

你會說這讓你能看到明年年初嗎？

All right. Well, I mean the -- we do have visibility because given the recent supply and demand in balance situation, customers tend to have a longer-term discussion with us. So yes, the answer is, yes, we do have a visibility all the way strong now to end of 2022.

好的。好吧，我的意思是 - 我們確實有知名度，因為鑑於最近的供需平衡情況，客戶傾向於與我們進行長期討論。所以是的，答案是，是的，從現在到 2022 年底，我們的能見度確實一直很高。

But again, this is a dynamic -- market dynamics in there. So we have to continue tracking the market. Given the current observation, we do expect that demand will continue to outpace the supply, driven by the mega trend. So in the near term, we have not seen any sign of inflection point yet, as I said earlier. And so we don't see that any signal that indicates the current situation will change. So yes, we do have some visibility, and we haven't seen any signs of change in the situation and giving the mega trend of some of the applications from 5G to EV, IoT. We think this demand is going to stay here.

但同樣，這是一種動態 - 那裡的市場動態。所以我們必須繼續跟踪市場。鑑於目前的觀察，我們確實預計在大趨勢的推動下，需求將繼續超過供應。所以在短期內，正如我之前所說，我們還沒有看到任何拐點的跡象。因此，我們看不到任何表明當前情況會發生變化的信號。所以是的，我們確實有一些可見性，我們沒有看到任何情況發生變化的跡象，也沒有看到從 5G 到電動汽車、物聯網的一些應用的大趨勢。我們認為這種需求將留在這裡。

Okay. Understood. Maybe for Chitung, do you have an estimate for 2021 for this year about operating expenses and D&A?

好的。明白了。也許對於 Chitung，您對今年 2021 年的運營費用和 D&A 有估計嗎？

Operating expenses for this year and next year, it's under control. I think our goal is really to maintain a steady percentage of ratio to overall revenue. And of course, revenue is continuing to grow. So the rate of revenue growth certainly is outpacing the rate of OpEx increase.

今年和明年的運營費用，都在控制之中。我認為我們的目標實際上是保持佔總收入的比例穩定。當然，收入還在繼續增長。因此，收入增長率肯定超過了運營支出的增長率。

The percentage OpEx not increasing. No, I'm asking because typically, as you mentioned, 22, tape-out and specialties processes and, at the same time, a bit more capacity increase than in the previous years, right? All those things cost a bit of money, I guess?

OpEx 未增加的百分比。不，我問的是因為通常，正如你提到的，22、流片和專業流程，同時，容量增加比前幾年多一點，對嗎？我猜所有這些東西都要花點錢吧？

Yes, definitely. But we all have more resources as well given the stronger performance. So again, we will control the ratio as a percentage of OpEx to revenue instead of the absolute dollar terms.

當然是。但鑑於更強的表現，我們都有更多的資源。因此，我們將再次控制 OpEx 佔收入的百分比，而不是絕對美元條款。

Understood. And for D&A, Chitung, any rough number?

明白了。至於 D&A，Chitung，有什麼粗略的數字嗎？

Same thing. I think the biggest component for expense increase is really the employee-related compensation. Because of the better performance, the bonus improvement to our employee will be higher. But the rest, again, is under well control.

一樣。我認為費用增加的最大部分實際上是與員工相關的薪酬。因為更好的表現，我們員工的獎金提高會更高。但其餘的，同樣，都在很好的控制之下。

Next question, Gokul Hariharan, JPMorgan.

下一個問題，摩根大通的 Gokul Hariharan。

Congrats on the good results. First question, I just wanted to explore a little bit on the blended pricing. Seems like ASP continues to accelerate roughly 3% in Q1, 5% in Q2 and 6% in Q3. Is there an updated guidance on how much we expect blended ASP to go up this year? I think previously, we talked about high single-digit approaching 10% last quarter.

恭喜取得好成績。第一個問題，我只是想探討一下混合定價。似乎 ASP 在第一季度繼續加速增長約 3%，第二季度增長 5%，第三季度增長 6%。是否有關於我們預計今年混合 ASP 上漲多少的最新指南？我想之前，我們談到上個季度接近 10% 的高個位數。

Is that going to be higher? And secondly, on the pricing itself, given that you have visibility into next year and you have a lot of commitments to the end of next year itself, could we talk a little bit about how we think about blended ASP as we go into next year? Is next year also a pretty strong price increase year because of product mix or so less on price adjustments? That's my first question.

那會更高嗎？其次，關於定價本身，鑑於您對明年有可見性，並且您對明年年底有很多承諾，我們能否談談我們在進入明年時如何看待混合 ASP ？由於產品組合或價格調整較少，明年是否也是價格上漲相當強勁的一年？這是我的第一個問題。

Okay? So in 2021, our targeted ASP growth will be around 10% to 13% year-over-year. The pricing also includes our product mix improvement, pricing adjustment. UMC does value long-term partnership over near-term cyclical patches. So therefore, our current ASP mainly reflects the value of our position right now.

好的？因此，到 2021 年，我們的目標平均售價將同比增長 10% 至 13% 左右。定價還包括我們的產品結構改進、定價調整。聯華電子確實重視長期合作夥伴關係，而不是近期的周期性補丁。因此，我們目前的平均售價主要反映了我們目前的頭寸價值。

In terms -- beyond 2021, I kind of touched that earlier, the pricing of the structural demand, we believe, is here to stay. Our customers does recognize that. So we expect the strength of structural demand momentum will sustain beyond Q4 2021.

就 2021 年以後而言，我之前提到過，我們認為結構性需求的定價將持續存在。我們的客戶確實認識到這一點。因此，我們預計結構性需求勢頭的強度將持續到 2021 年第四季度以後。

Got it. Just 1 more question on the CapEx side. I think when we talk about the TWD 2.3 billion CapEx this year, how much of our Fab 12A P6 expansion does it cover? Given that we are also looking for around 6% capacity addition next year, do we expect CapEx to stay around these levels as we look into next year as well?

知道了。關於資本支出方面還有 1 個問題。我認為當我們談論今年 23 億新台幣的資本支出時，它涵蓋了我們 Fab 12A P6 擴建的多少？鑑於我們還希望明年增加約 6% 的產能，我們是否預計明年的資本支出也將保持在這些水平附近？

About the -- we announced the P6 program will be somewhere in the TWD [3.7] billion CapEx and the estimated rent schedule will be sometime in the second quarter of '23. So most of those will probably happen within the 2022. There is a very minimum portion of that is within the 2021 number. So I think that provide will that -- we will provide that guidance by end of this year for 2022.

關於——我們宣布 P6 計劃將在新台幣 [37] 億資本支出中進行，預計租金時間表將在 23 年第二季度的某個時候進行。因此，其中大部分可能會在 2022 年內發生。其中極小部分發生在 2021 年。所以我認為這會提供 - 我們將在今年年底為 2022 年提供該指導。

Understood. Given -- maybe 1 more question. Given that we are seeing a lot of tightness in -- especially in 8-inch and as you mentioned, pacing on ROI challenge in terms of capacity expansion also. Could we talk a little bit about how quickly or how keen are customers to migrate some of their 8-inch products to more mature 12-inch technologies? And also given everything is tied, how feasible is it for them to do that over the next, let's say, 6 to 12 months?

明白了。鑑於 - 可能還有 1 個問題。鑑於我們看到很多緊張——特別是在 8 英寸，正如你提到的，在產能擴張方面也面臨 ROI 挑戰。我們能否談談客戶將他們的一些 8 英寸產品遷移到更成熟的 12 英寸技術的速度有多快或有多熱切？而且考慮到一切都捆綁在一起，他們在接下來的 6 到 12 個月內這樣做的可行性有多大？

Well, just like you mentioned, the -- all nodes are tight across some 8-inch to 12-inch. So the migration -- if the migration -- the purpose of migration is to add this to additional capacity in 12-inch that will be very challenging. The natural pace of the migration will continue, I think, on different applications. Those activity is ongoing. But for capacity reasons, I think, this is going to be rather challenging at this time because all nodes are very, very tight right now.

好吧，就像你提到的，所有節點在 8 英寸到 12 英寸之間都很緊。所以遷移——如果遷移——遷移的目的是將此添加到 12 英寸的額外容量，這將非常具有挑戰性。我認為，在不同的應用程序上，遷移的自然速度將繼續下去。這些活動正在進行中。但出於容量原因，我認為，此時這將是相當具有挑戰性的，因為現在所有節點都非常非常緊張。

Understood. Just last one. When you talk about the 6% capacity increase next year, is that also largely in 28 and 22? Or are you thinking a little bit more on 40, 55, et cetera, also?

明白了。只是最後一個。當你談到明年 6% 的運力增長時，主要是在 28 和 22 嗎？或者您是否也在考慮 40、55 等等？

The breakdown of the 22 mainly is still led by more than 20% year-over-year growth in our 28 nanometers, okay? There will be some increase in the 8-inch advanced node, which means below 0.18 through some of the upgrades. So this is probably a combination of those, are the main nodes.

22 的細分主要還是我們 28 納米同比增長超過 20% 好嗎？ 8寸進階節點會有一些提升，也就是通過一些升級低於0.18。所以這可能是這些的組合，是主要節點。

Next question, Bruce, Goldman Sachs.

下一個問題，布魯斯，高盛。

Congrats on the group results, and I'm actually very impressed about your ESG improvement, especially more than half of the Board of Directors are independent directors, which is important for the long-term shareholders. So I noticed that for the last 2 quarters news announcement, you addressed a lot of -- you addressed the automotive. Can you tell us what is the revenue exposure to automotive right now? And what's your target in 2 to 3 years? What are the key applications and the process node for the automotive customer? Do they carry higher or lower than corporate average margins?

祝賀集團取得的成績，實際上我對你們在 ESG 方面的改善印象非常深刻，尤其是超過一半的董事會是獨立董事，這對長期股東來說很重要。所以我注意到，在過去兩個季度的新聞公告中，你談到了很多——你談到了汽車。你能告訴我們現在汽車的收入敞口是多少嗎？您在 2 到 3 年內的目標是什麼？汽車客戶的關鍵應用和工藝節點是什麼？他們的利潤率是高於還是低於公司平均利潤率？

Our revenue contribution from automotive is very, very small. They're still below 10% mark. And there are the demand recovery issue from end of 2020 on automotive. So we are putting some resource to support that and ability to support that. And from year-over-year standpoint, we increased the absolute number probably by close to 20% in the auto segment.

我們來自汽車的收入貢獻非常非常小。他們仍然低於 10% 的大關。從 2020 年底開始，汽車行業存在需求復蘇問題。所以我們正在投入一些資源來支持它，並有能力支持它。從同比的角度來看，我們在汽車領域的絕對數量可能增加了近 20%。

So we are putting some priority and resource to support that urgent need. So as far as the customers margin goes, we don't comment on specific customer or segments margin and whether on a corporate level. So I think in general, they are reasonable -- in a reasonable ASP level.

因此，我們將一些優先事項和資源用於支持這一迫切需求。因此，就客戶利潤率而言，我們不評論特定客戶或細分市場的利潤率以及是否在公司層面。所以我認為總的來說，它們是合理的——在合理的 ASP 水平上。

Okay. So can I ask in a different way that can we expect automotive revenue to be more than 10% in a year or 2? And what are the key applications within that auto segment in your -- for your customers?

好的。那麼我可以換一種方式問，我們能否期望汽車收入在一年或兩年內超過 10%？對於您的客戶，該汽車細分市場中的關鍵應用程序是什麼？

I think from the application standpoint, we are putting more resource to the automotive space. So we are expecting the automotive space will grow. So -- and I don't have a number to quote it here. And we can provide that on an ongoing basis.

我認為從應用的角度來看，我們正在向汽車領域投入更多資源。因此，我們預計汽車領域將會增長。所以 - 我沒有在這裡引用的數字。我們可以持續提供。

But just to add on that, we mentioned EV is an important driver for our silicon content going forward. So we would like to take a broader view that auto industry should eventually include the EV as a driver as well. So that percentage certainly is likely to continue to increase.

但除此之外，我們提到 EV 是我們未來矽內容的重要驅動力。因此，我們想從更廣泛的角度來看，汽車行業最終也應該將電動汽車作為一種驅動因素。所以這個百分比肯定會繼續增加。

Okay. So next one. I always like to ask your R&D expenses. I mean if you look at your R&D expenses in the first half, it's already like 6.5%, which is down from like 8% to 9% in the last couple of quarters. So basically, what is the long-term target right now? I mean (inaudible) R&D expense is 5.5% of the sales. Is that a reasonable target for your R&D expenses?

好的。那麼下一個。我總是喜歡問你的研發費用。我的意思是，如果你看看上半年的研發費用，它已經是 6.5%，在過去幾個季度從 8% 下降到 9%。那麼基本上，現在的長期目標是什麼？我的意思是（聽不清）研發費用佔銷售額的 5.5%。這是你們研發費用的合理目標嗎？

We think the current R&D expenses is about right. I think, certainly, we want to allocate more resources to our R&D effort in order to differentiate ourselves, especially on the specialty technology and also the future technology related to 5G and EV. And again, the absolute dollars will continue to grow. But certainly, the percentage of revenue will be well controlled.

我們認為目前的研發費用是合適的。我認為，當然，我們希望將更多資源分配給我們的研發工作，以使我們自己脫穎而出，特別是在專業技術以及與 5G 和 EV 相關的未來技術上。同樣，絕對美元將繼續增長。但可以肯定的是，收入的百分比將得到很好的控制。

I see. Okay. Lastly, for the P6 profitability, I remember last time when management was talking about, which is like roughly a 30-plus percent gross margin for P6. But if we fast forward to 2022 and 2023, this gross margin will be lower than the corporate average in a meaningful way. So that sounds right?

我懂了。好的。最後，對於 P6 的盈利能力，我記得上次管理層談到的時候，這大約是 P6 的 30% 以上的毛利率。但如果我們快進到 2022 年和 2023 年，這個毛利率將以有意義的方式低於公司平均水平。聽起來對嗎？

Well, we expect that P6 will have a better cash margin, means higher EBITDA margin than the 12-inch corporate average. And we adopted P6 because we believe this is a win-win collaboration model that not only secured long-term capacity for customer, the predetermined pricing will also enable UMC to grow organically and to meet our long-term profitability.

那麼，我們預計 P6 將有更好的現金利潤率，這意味著 EBITDA 利潤率高於 12 英寸企業平均水平。我們之所以採用 P6，是因為我們相信這是一種雙贏的合作模式，不僅為客戶確保了長期產能，預定的定價也將使 UMC 有機增長並滿足我們的長期盈利能力。

Well, given the -- our corporate average gross margins on rise, the initial P6 gross margin will be in catch-up mode, like you said. However, over time, the P6 will -- gross margin will eventually enhance our corporate average.

好吧，鑑於 - 我們的企業平均毛利率在上升，最初的 P6 毛利率將處於追趕模式，就像你說的那樣。然而，隨著時間的推移，P6 將——毛利率最終將提高我們的企業平均水平。

I see. Understand. Your corporate average gross margin improvement is much faster than we think, so that's why it creates some discrepancy, though. Okay.

我懂了。理解。你們公司平均毛利率的提高比我們想像的要快得多，所以這就是為什麼它會產生一些差異的原因。好的。

Next question is from Nicholas (inaudible), UBS.

下一個問題來自瑞銀集團的尼古拉斯（聽不清）。

2 quick questions. First, going back to LTAs. Is there a way you could quantify perhaps for us how much of the expected capacity for P6, which I think is 27,000, 28,000 wafers per month will eventually be covered by LTAs? And secondly, going back to specialty processes. Could you maybe give us more color in -- as to which ones you see better traction of customers right now between low power or embedded memory, MCUs, high voltage, CIS, et cetera?

2 個快速問題。首先，回到長期協議。有沒有一種方法可以為我們量化 P6 的預期產能，我認為每月 27,000、28,000 片晶圓最終將由 LTA 覆蓋？其次，回到專業流程。您能否給我們更多的顏色 - 關於您現在在低功耗或嵌入式內存、MCU、高壓、CIS 等之間看到哪些更能吸引客戶？

The application strength from the overall global demand perspective and within the application, the catalyst is really more of a 5G transformation. And of course, we mentioned about EV and as well as the digital transformation on the IoT devices. And for the 5G transformation associated with the high-voltage device has probably the strongest momentum. That includes OLED driver. And the 5G also have ISP, WiFI6, RF Switch. So those will be probably the -- has the strongest momentum at this point due to the 5G mega trend, and followed by the MCU and the power management.

從全球整體需求的角度和應用內部的應用強度來看，催化劑實際上更多是5G轉型。當然，我們提到了電動汽車以及物聯網設備的數字化轉型。而與高壓設備相關的 5G 轉型勢頭可能最為強勁。這包括 OLED 驅動器。而5G還有ISP、WiFI6、RF Switch。因此，由於 5G 大趨勢，這些可能是目前勢頭最強勁的，其次是 MCU 和電源管理。

Great. And how about the LTA question for P6, please?

偉大的。請問 P6 的 LTA 問題如何？

For P6?

給P6？

Can you repeat your question?

你能重複你的問題嗎？

Sure. So when you talked about customer signing LTAs for P6, approximately when you look ahead and when you will reach 27,000, 28,000 wafers per month in P6 capacity? How much about do you think is likely to be covered by LTAs?

當然。因此，當您談到客戶為 P6 簽署 LTA 時，大約在您展望未來時，您將在 P6 產能中達到每月 27,000、28,000 片晶圓？您認為 LTA 可能涵蓋多少？

The OP6 program is covered by the contract, yes.

OP6 程序包含在合同中，是的。

And next question, (inaudible), UBS.

下一個問題，（聽不清）瑞銀。

I would just like to ask the management to give us a -- maybe a long-term gross margin target. It is just because the recent quarters, your gross margin has been improving quite fast in a very rapid pace and perhaps give us a guideline of a long-term target, this margin improvement?

我只想請管理層給我們一個——也許是一個長期的毛利率目標。只是因為最近幾個季度，你們的毛利率一直在以非常快的速度提高，也許給我們一個長期目標的指導方針，這種利潤率提高？

We -- I kind of touched that question through ASP trend, but the question always came back to the gross margin. Our gross -- our margin outlook is mainly driven by all those factors I mentioned, from production, efficiency, ASP and product mix optimization, cost reduction and so on and so forth.

我們 - 我通過 ASP 趨勢觸及了這個問題，但問題總是回到毛利率。我們的毛利率——我們的利潤率前景主要受到我提到的所有這些因素的驅動，從生產、效率、ASP 和產品組合優化、成本降低等等。

So we believe those will give us this benefit to strengthening our structural gross margin. So we do expect this gross margin probably continue to improve, I would say. But I'm not -- I don't think we are ready here to giving any gross margin guidance or any gross margin, the outlook for the -- for our target, yes.

因此，我們相信這些會給我們帶來加強結構性毛利率的好處。所以我們確實預計這個毛利率可能會繼續提高，我會說。但我不是 - 我認為我們不准備在這裡提供任何毛利率指導或任何毛利率，我們的目標前景，是的。

So in a way we should view that the possible upside could still be there? Or the recent quarters margin is not sustainable?

因此，在某種程度上，我們應該認為可能的上行空間仍然存在嗎？還是最近幾個季度的利潤率不可持續？

We certainly believe the -- all the structure demand, all the existing environment is here to stay. So I don't think there's -- in the near term, we haven't seen any reflection point that this will change in a different direction. I think from the -- direction is we're still marching to improve our gross margin, yes.

我們當然相信 - 所有結構需求，所有現有環境都將保留下來。所以我不認為 - 在短期內，我們沒有看到任何反映這將朝著不同方向改變的點。我認為 - 方向是我們仍在努力提高我們的毛利率，是的。

Got it. And then also a follow-up. How do you run utilization rate at more than 100%?

知道了。然後還有後續行動。如何讓利用率超過 100%？

Well, it's actually 100%. Just 100% plus is meaning it's really full. So it is not, yes.

嗯，實際上是 100%。只有 100% 以上意味著它真的很滿。所以它不是，是的。

Ladies and gentleman, we're taking the last one. And the last question is from Randy Abrams, Crédit Suisse.

女士們，先生們，我們要吃最後一個了。最後一個問題來自瑞士信貸銀行的 Randy Abrams。

Two final questions. Depreciation, Chitung, could you give an update the trend for the next 1 to 2 years? Now on the new CapEx plan, how we should -- would factor that in?

最後兩個問題。折舊，Chitung，你能更新一下未來 1 到 2 年的趨勢嗎？現在關於新的資本支出計劃，我們應該如何——將其考慮在內？

I think for this year and next year, we are talking about 0 to 5 -- below -- around 5% or less decline for our overall depreciation expenses. And for 2023, it really depends on the equipment we brought online. And right now, the lead time is actually quite long.

我認為今年和明年，我們談論的是 0 到 5——低於——我們的整體折舊費用下降約 5% 或更少。而對於 2023 年，這實際上取決於我們上線的設備。現在，交貨時間實際上很長。

So it's a little bit difficult to predict the depreciation expenses for 2023. However, again, we will control it through a percentage of revenue benchmarks. And percentage-wise, we hope it will be a steady to decline rate. But the absolute dollar term depends on the new capacity come on stream.

因此，預測 2023 年的折舊費用有點困難。但是，我們將再次通過一定比例的收入基準來控制它。在百分比方面，我們希望下降率會穩定。但絕對美元期限取決於新產能的投產。

Okay. And the other one I wanted to ask, the other income bumped back up to TWD 1.6 billion. Was there a factor for that lift? And then looking forward, does that -- is there a certain period that continues? Is that still tied to the Xiamen? And how would that continue out into the future?

好的。還有一個我想問的，另一個收入又漲到16億新台幣。這種提升有什麼因素嗎？然後展望未來，是否有某個持續的時期？那還繫在廈門嗎？這將如何持續到未來？

Just once a year, there's extra subsidies related to our syndicated loans. And I think that will be the last time for this second quarter. Going forward, I think around TWD 10 billion per quarter will be a norm for each quarter, at least, for a few years.

每年只有一次，我們的銀團貸款有額外的補貼。我認為這將是第二季度的最後一次。展望未來，我認為每季度大約 100 億新台幣將成為每個季度的標準，至少在幾年內是這樣。

Okay. I'm sorry, say that again. It was...

好的。對不起，再說一遍。它是...

TWD 1 billion per quarter.

每個季度 10 億新台幣。

TWD 1 billion per quarter.

每個季度 10 億新台幣。

Yes. Per quarter, TWD 1 billion.

是的。每個季度，新台幣 10 億。

Thank you, and we thank you for all your questions. That concludes today's Q&A session. I'll turn things over to UMC Head of IR for closing remarks.

謝謝，我們感謝您提出的所有問題。今天的問答環節到此結束。我會把事情交給 UMC 的 IR 負責人作結束語。

Thank you for attending this conference today. We appreciate your questions. As always, if you have any additional follow-up questions, please feel free to contact UMC at ir@umc.com. Have a good day. Thank you.

感謝您參加今天的會議。感謝您提出問題。與往常一樣，如果您有任何其他後續問題，請隨時通過 ir@umc.com 聯繫 UMC。祝你有美好的一天。謝謝你。

Thank you. And ladies and gentlemen, that concludes our conference for second quarter 2021. Thank you for your participation in UMC's conference. There will be a webcast replay within an hour. Please visit www.umc.com under the Investors Events section. You may now disconnect. Goodbye.

謝謝你。女士們，先生們，我們 2021 年第二季度的會議到此結束。感謝您參加 UMC 的會議。一個小時內將進行網絡廣播重播。請訪問投資者活動部分下的 www.umc.com。您現在可以斷開連接。再見。