SMIC's profit surges 39pc last year, sees above-average sales growth for 2026

Semiconductor Manufacturing International Corp’s (0981) posted a 39 percent surge in net profit to US$685 million (HK$5.34 billion) last year and expects a higher-than-average revenue growth for 2026. 

Revenue for China's largest chipmaker jumped by 16.2 percent to US$9.3 billion, as wafer shipments surged by 20.9 percent. The average selling price, however, dipped by 3 percent to US$907 per wafer.

In the year, SMIC’s utilization rate – total wafers out divided by estimated total capacity – grew by 8 percentage points to 93.5 percent. Gross margin also climbed 3 percentage points to 21 percent, despite a substantial increase in depreciation.

It spent US$774 million on research and development last year and expects capital expenditure to be roughly flat this year. 

The robust demand for memory chips driven by AI has squeezed the supply for other applications such as phones, particularly in the mid-to low-end market, leading to a decline in demand for end products, SMIC said. But leveraging the technological reserves and advantages in segmented markets, the chipmaker is still “well-positioned” in the current cycle, it added.