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TAIPEI, Apr 26 (Reuters) UMC, the world's second-largest contract maker of microchips, posted an eight-fold jump in quarterly profit on Wednesday, beating estimates, as robust sales of consumer gadgets boosted demand for chips.

For the second quarter, UMC said it expected shipments to rise by 5 to 6 percentage points from the first three months, with average selling prices rising by 2 percentage points.

The firm's capacity utilisation rate would edge up to about 80 percent in the April-June quarter, versus 79 percent in the first quarter.

Riding high on a boom for higher-end mobile phones, game machines and flat-screen televisions, analysts expect UMC and its larger rival TSMC to increase profits this year.

''For Q2, as a whole, we believe that demand will be in line with seasonal norms,'' Jackson Hu, UMC chairman and chief executive officer, said in a statement.

''Computer sector demand will be relatively weak due to seasonal inventory adjustments. At the same time, we have seen handset demand start to accelerate, which is about one to two months earlier than typical seasonal trends.'' United Microelectronics Corp. (UMC) earned a net profit of T$12.286 billion (US$384 million) for the quarter ended March 31, up sharply from T$1.52 billion a year earlier when customers digested excess inventory on unexpectedly weak consumer demand.

The result beat the T$1.58 billion consensus forecast compiled by Reuters Estimates.

UMC shares rose 10 percent in the first quarter, outperforming the main TAIEX's 1 percent gain. TSMC's shares rose 3 percent in the same period.

UMC'S result compared with an expected 69 percent jump in first-quarter earnings by sector leader Taiwan Semiconductor Manufacturing Co. (TSMC), which is set to announce its quarterly results on Thursday.

UMC, which counts Texas Instruments Inc. (TI) and Xilinx Inc. as major clients, has said it plans to spend US$1 billion on capital spending this year, up from about $700 million in 2005.

(US$=T$32.0) REUTERS CS KN1208