Leading Chinese chipmaker Semiconductor Manufacturing International Corp. (0981.HK; 688981.SH)(SMIC) announced on Tuesday that its net profit rose 61% year-on-year to $173 million in last year’s fourth quarter, boosted by higher wafer shipments.
Revenue for the quarter rose 13% year-on-year to $2.5 billion, driven mainly by increased wafer sales and changes in the company’s product mix. Its gross margin declined 3.4 percentage points year-on-year to 19.2%, which the company attributed to higher depreciation expenses.
For the full year, SMIC’s net profit climbed 39% to $685 million, while its revenue rose 16% to $9.3 billion. Its annual gross margin rose 3 percentage points to 21%. The company attributed the annual profit growth mainly to higher wafer shipments, improved capacity utilization and a more favorable product mix.
By year-end, SMIC’s monthly capacity, based on eight-inch equivalent logic wafer equivalents, reached 1.06 million units, an increase of about 110,000 wafers. Total shipments for the year were approximately 9.7 million wafers, while average capacity utilization rose eight percentage points to 93.5%.
Looking ahead, SMIC said opportunities from supply-chain reshoring will coexist with challenges stemming from memory-cycle volatility this year. SMIC guided that revenue would be flat quarter-on-quarter in this year’s first quarter, and its gross margin would fall in the 18% to 20% range. Assuming no major changes in the external environment, the company expects its full-year revenue growth to outperform industry peers, while its capital expenditure is projected to remain broadly in line with 2025 levels.
SMIC’s stock opened lower on Wednesday, closing down 3.63% at HK$68.95 by the midday break. The company’s Hong Kong-listed shares are up about 52% over the last 52 weeks.
By Lee Shih Ta
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