SMIC reports record high revenue and gross margin in Q3
Published: Nov 12, 2021 02:19 AM


China's top chipmaker, Semiconductor Manufacturing International Corporation (SMIC), reported 30.7 percent year-on-year growth on its revenue to a record high of $1.42 billion in the third quarter. Its gross profit expanded 78.6 percent to $467.9 million as sales contribution from the company's matured chip manufacturing technology expanded and semiconductor's price continued climbing up.

Gross margin also reached record highs. The SMIC's gross profit rate in Q3 was 30.2 percent, gaining 3.9 percentage points year-on-year, according to the company's financial statement issued on Thursday. 

Sales generated by SMIC's matured chip technology, including 55/65 nm and 0.15/0.18 micron chip-making technology, accounted for more than half of its revenue, the financial statement showed. 

The company expected Q4 revenue to increase by 11 to 13 percent, compared with Q3, with gross margin sitting at 31 to 33 percent. Looking forward, SMIC believes the company's capacity shortage, as compared to its customers' demand, is expected to continue through next year. And its revenue growth next year, based upon a rapid expansion this year, will not be lower than the industry average level. 

In the financial statement SMIC said that, since it was placed on the "entity List" by the US, it has faced tremendous challenges in production and operations. Since the beginning of the year, the firm has focused on the two main priorities of ensuring operation continuity and continuous capacity expansion, realigning the supply chain and finding ways to optimize the procurement process, accelerate supplier qualification, and improve production planning and engineering management.

"At present, operation continuity has been basically stabilized, expansion of mature technology is progressing in an orderly manner and as scheduled, an advanced technology business is steadily improving," SMIC noted. 

The company also announced on Thursday that its vice chairman, Chiang Shang-Yi, has resigned to spend more time with his family, which comes less than a year after joining the firm. Chiang is a heavy weight in the chipmaking industry and plays a key role in helping TSMC, his former employer, become a globally leader in chip manufacturing.

This is the second departure of a senior executive from SMIC in recent months after its core technical personnel, Wu Jingang, resigned in July.