Semiconductor Manufacturing International Corp reported a 59.1% fall in second-quarter net profit on Thursday though the result from China's largest chip foundry beat expectations.
SMIC reported $164.6 million in unaudited profit attributable to owners for the three months to June 30, topping the $103.8 million expected by analysts polled by LSEG, while revenue rose by 21.8% to $1.9 billion, also beating forecasts.
The results reflect signs of recovery in the global semiconductor industry after a prolonged slump that began in late 2022.
Global semiconductor sales rose 18.3% to $149.9 billion in the second quarter, with the Chinese market growing 21.6%, according to the Semiconductor Industry Association.
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While SMIC primarily produces basic chips for less sophisticated electronics, it gained attention after a Huawei smartphone teardown revealed an SMIC-made chip among the most advanced produced in China.
However, advanced chip production remains limited, constraining SMIC's ability to fully capitalize on the AI boom driving growth for some rivals.
Industry leader TSMC reported a 40% increase in second-quarter revenue, largely attributed to strong demand for advanced chips in AI and high-performance computing.
SMIC forecast a 13% to 15% quarter-on-quarter revenue increase for the current quarter.
Capital expenditure was $2.25 billion in the quarter.
Published - August 08, 2024 04:54 pm IST
