# UMC begins new chip production in Singapore Taiwanese chipmaker starts mass production in Singapore for AI infrastructure needs. - **Source:** [US Top News and Analysis](https://brifing.si/source/635540e9-943e-450d-ae52-ae0bfe3b67eb) - **Published:** 2026-07-14 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/569fa1ee-c95b-4d7d-ad0d-a9f33a95d91c ## Production Move Taiwan's second-largest chipmaker UMC has started mass production of silicon photonics wafers at its Singapore facility. This move aims to address the growing demand for high-speed optical interconnects in AI and hyperscale data centers. Partnering with local fabless chip designer SILITH, UMC brought the technology to production readiness in 18 months. ## Technological Significance Silicon photonics is a critical technology for ultra-high-speed data transmission and processing. According to Polaris Market Research, the global market is expected to reach $3.71 billion by 2026, driven by increasing data traffic and demand for faster optical communication. UMC's investment in this field prepares for future AI infrastructure needs. ## Financial Performance Citi analysts forecast an improving outlook for UMC in the second half of 2026. The company reported June sales up 22.85% year-on-year to $719 million. Cumulative sales in the first half rose 11.28%. However, UMC's shares fell nearly 5% in Taiwan before closing 1.6% lower. ## Regional Expansion UMC is among several Taiwanese tech companies expanding manufacturing presence in Singapore. The city-state is becoming a key hub in the global semiconductor supply chain. Companies like King Yuan Electronics and TSMC-backed Vanguard International are also making significant investments in Singapore. ## Future Plans UMC plans to make its 12-inch silicon photonics platform available for customer product development by 2027. This strategy aims to strengthen the company's position in the high-value chip market. Citi expects a 13% quarterly sales jump in Q2 2026 and gross margin recovery. ## Industry Impact UMC's move will influence competition dynamics in the global semiconductor industry. The growing manufacturing hub in Singapore enhances supply chain resilience in the Asia-Pacific region. Increasing demand for AI and data center infrastructure accelerates investment in innovative technologies like silicon photonics. ## Sources covering this story - https://www.cnbc.com/2026/07/14/umc-starts-mass-production-in-singapore-citi-sees-improving-outlook.html — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._