SMIC Q3 performance hits record high despite US export curbs

Source: Global Times Published: 2020/11/12 12:07:53


Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC) reported record high quarterly revenue and net margin in the third quarter, calling the impact of US export curb on the company controllable in short term. 

In the third quarter, the company’s earnings reached record high with the revenue hitting 7.638 billion yuan ($1.15 billion), surging 13 percent compared with the second quarter and 31.7 percent year-on-year, said Gao Yonggang, chief financial officer at SMIC, in its quarterly earnings report. 

Gross margin in the third quarter hit 2.008 billion yuan while the net profit attributable to shareholders reached 1.694 billion yuan, according to Gao. 

Based on the outstanding performance, the chipmaker’s revenue from January to September jumped by 30.3 percent year-on-year, and its net profits attributable to shareholders surged 168.6 percent compared with the period last year, the quarterly results showed. 

Though the Trump administration placed restrictions on American companies’ exports to SMIC in September, the chipmaker said it is currently operating normally, and that the US curbs on the company have had certain impact but are “controllable in the short term.”

The high performance of SMIC shows the Chinese company had made full preparation and had stocked up to deal with the US crackdown, Xiang Ligang, director-general of the Beijing-based Information Consumption Alliance, told the Global Times on Thursday, adding the better-than-expected results will continue. 

“It is quite obvious that the Trump administration has failed in killing Chinese tech firms SMIC and Huawei by launching the tech war with China. Not only did they not fall, but also thrived,” Xiang said. 

More importantly, Chinese firms have found replacements in certain areas and are firmly determined to enhance their independent R&D capacities to confront with the possible US crackdown, he added. 

During a conference call on Thursday, SMIC co-CEO Zhao Haijun noted the delivery of some US-made equipment, parts and raw materials has been delayed, and SMIC hopes to build mutual trust and resume normal procurement. 

“As a contract manufacturer, SMIC deals with a variety of customers from within and outside China. The company has strictly abided by local laws and operated legally,” Zhao reiterated, adding SMIC will monitor the US export restrictions and evaluate the impact constantly. 

Global Times


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