SMIC says AI chip supply chain will remain tight through 2027

China's biggest contract chipmaker, Semiconductor Manufacturing International Corp (0981), said on Friday that the artificial intelligence industry was still in its early stages and demand remained strong.

SMIC Co-CEO Zhao Haijun made the comment in response to a question about whether the AI industry was forming a bubble.

• Many customers that need computing resources still face shortages, Zhao said
• The semiconductor supply chain for AI-related applications will stay tight through 2027 on demand from data centres and private clouds, Zhao said
• Memory chip supply and demand should reach balance toward the middle to end of 2028, Zhao said
• SMIC expects full-year revenue to exceed US$1.2 billion as its capacity utilization rate continues to rise
• The company faces longer lead times for equipment, with some orders taking more than 24 months to deliver, which would affect its capital spending this year
• SMIC's depreciation expense will rise about 30 percent year-on-year in 2026, Zhao said

Reuters

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