UMS (SGX:558) reported in-line 1Q26 earnings of S$14m (+43% y-o-y), at 25% of our full-year forecast. Net margin improved 3.3ppt y-o-y in 1Q26 due to a forex gain of S$1.5m vs a S$1.1m loss in 1Q25. Gross margin fell 3ppt y-o-y due to lower US$/S$ exchange rate.
1Q26 revenue rose 20% y-o-y due to growth in the semiconductor and aerospace segments.
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Apart from the US, sales improved in all key geographical markets. Revenue in Malaysia surged 28% in 2025 on more orders from the new key customer while sales in Taiwan and others leapt 63% and 256% respectively. Also, Singapore sales grew 10% y-o-y.
UMS remains positive about its prospects.
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Both UMS's key customers reported first quarter results that beat revenue estimates. The order flow from UMS's new key customer remains very robust, as it seeks to divert its US supply source to Asia.
In the coming months, UMS will carry on with qualifications of many new product introductions for this new key customer. UMS also expects its integrated system demand to increase as its existing key customer’s outlook stays strong due to higher semiconductor capital spending from 2026 through 2028, as chipmakers keep putting money into advanced-node capacity to build more complex processors.
Earnings Revision
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Above is an excerpt from a report by UOB Kay Hian Research. Clients of UOB Kay Hian may be the first to access the full PDF report @ https://www.utrade.com.sg/.
