UMC.US (UMC.US) achieved mass production of the first batch of silicon photonic wafers in Singapore. Citi is optimistic about the performance in the second half of the year and expects sales to increase 13% month-on-month in the second quarter

The Zhitong Finance App learned that UMC (UMC.US), the second-largest wafer foundry in Taiwan Province of China, announced on Tuesday that its Singapore-based fab has successfully mass-produced the first batch of silicon photonic wafers. UMC aims to meet the growing demand for high-speed optical interconnections in artificial intelligence (AI) and hyperscale data center networks.

UMC said in a statement that through collaboration with SILITH Technology (SILITH Technology), a local wafer-free chip design company, the joint team moved the silicon photonic platform from development to production ready within 18 months, thus obtaining technology to support the next generation of AI infrastructure. UMC also plans to open its own 12-inch silicon photonic platform to customers for product development by 2027.

Prior to that, Citigroup analysts said they were optimistic about the chipmaker's prospects for the second half of the year and predicted that its sales would increase 13% month-on-month in the second quarter of 2026, and that gross margin would pick up somewhat.

To support Wall Street's optimism, UMC recently announced strong financial results: June sales increased 22.85% year over year to NT$23.12 billion (approximately US$7192.1 million), and cumulative sales increased 11.28% in the first half of the year. However, in Tuesday's trading, the company's stock price in Taiwan fell by nearly 5%, then recovered some of its losses and closed down 1.6%.

Currently, as Singapore gradually develops into an important regional hub in the global semiconductor supply chain, UMC is also one of many Taiwanese technology companies that are expanding their manufacturing footprint in Singapore. This growing ecosystem also includes Jingyuan Electronics and Vanguard International Semiconductor Corporation (Vanguard International Semiconductor Corporation), a foundry with TSMC's (TSMC) background, which recently partnered with NXP Semiconductors headquartered in the Netherlands to build a $7.8 billion manufacturing facility in Singapore.

Silicon photonics is a key technology for transmitting and processing data at extremely high speeds. The market is showing significant growth due to the increase in data traffic and the demand for faster optical communication. According to Polaris Market Research, the global market size is expected to reach approximately $3.71 billion by 2026.