SEMICONDUCTOR Manufacturing International Corp (SMIC) reported a 59.1 per cent fall in second-quarter net profit on Thursday (Aug 8) though the result from China’s largest chip foundry beat expectations.
SMIC reported US$164.6 million in unaudited profit attributable to owners for the three months to Jun 30, topping the US$103.8 million expected by analysts polled by LSEG, while revenue rose by 21.8 per cent to US$1.9 billion, also beating forecasts.
The results reflect signs of recovery in the global semiconductor industry after a prolonged slump that began in late 2022.
Global semiconductor sales rose 18.3 per cent to US$149.9 billion in the second quarter, with the Chinese market growing 21.6 per cent, according to the Semiconductor Industry Association.
While SMIC primarily produces basic chips for less sophisticated electronics, it gained attention after a Huawei smartphone teardown revealed an SMIC-made chip among the most advanced produced in China.
However, advanced chip production remains limited, constraining SMIC’s ability to fully capitalise on the AI boom driving growth for some rivals.
Industry leader TSMC reported a 40 per cent increase in second-quarter revenue, largely attributed to strong demand for advanced chips in AI and high-performance computing.
SMIC forecast a 13 to 15 per cent quarter-on-quarter revenue increase for the current quarter.
Capital expenditure was US$2.25 billion in the quarter. REUTERS
