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CGIUMC

CGI vs UMC

This page compares CGI and UMC on business models, financial performance, and market context, presenting neutral, accessible information about each organisation's approaches to growth, operations, and...

Investment Analysis

CGI

CGI

GIB

Pros

  • CGI delivered a 9.7% year-over-year revenue increase to $4 billion in Q4 2025, surpassing market expectations with strong EPS growth.
  • The company’s strategic focus on AI integration and managed services drove double-digit EPS expansion and an 11.2% adjusted EBIT increase in fiscal 2025.
  • Robust client relations and recent acquisitions in Europe expanded customer reach, with managed IT new bookings at their highest post-pandemic level.

Considerations

  • Pricing pressure persisted with flat gross and adjusted operating margins year-over-year due to delayed mass AI workload rollouts and cautious enterprise IT demand.
  • CGI faces near-term headwinds from a slowdown in the US federal segment, anticipating quarterly revenue and operating income declines.
  • Despite growth, the company’s exposure to government IT spending may limit margin expansion as government budgets remain tight in the near term.
UMC

UMC

UMC

Pros

  • UMC operates a global foundry network supporting diverse end markets including mobile, IoT, computing, and automotive, providing broad industry exposure.
  • The company maintains a relatively low price-to-earnings ratio compared to sector peers, suggesting potential valuation support.
  • UMC offers backend, design support services and venture capital initiatives, enhancing its growth avenues beyond pure wafer fabrication.

Considerations

  • UMC’s stock price and valuation metrics have shown limited upside potential, with some analyst targets indicating possible negative returns.
  • The semiconductor foundry industry is highly cyclical and exposed to volatile demand and pricing pressures, impacting UMC’s profitability consistency.
  • Intense competition from larger foundries with advanced technologies poses execution risks and margin pressure for UMC’s market share.

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